Treasury Department recovers $31 million in payments to dead people

The Treasury Department announced this week that it had recovered more than $31 million in fraud and improper payments to dead people in just five short months after gaining access to the Social Security Administration’s federal death database (SSA).

The Department of Finance issues billions of payments each year, including benefit payments, federally funded state-administered payments, and other miscellaneous payments. Accidentally sending these and other funds to people who have died has been a long-standing problem within the federal government, according to tax watchdog group OpenTheBooks..

In 2020, the Government Accountability Office estimated that during the first round of COVID-19 stimulus checks, $1.4 billion was sent to dead people. In the three rounds of stimulus checks during the pandemic, nearly $3.6 billion went to dead people, according to OpenTheBooks.

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The SSA is the only government agency with a database that records the deaths of US citizens. In 2023, as part of an omnibus appropriations bill, congress granted access to the Treasury Department, on a temporary basis, to gain access to the database to help prevent improper payments to dead people. The temporary base is expected to expire in 2026.

A Social Security card sits next to US Treasury checks in Washington, DC on October 14, 2021. (Kevin Dietsch/Getty Images)

“While this should have been a no-brainer for a long time, it’s promising to see some taxpayer funds being recovered with basic communication between executive agencies,” said John Hart, executive director of OpenTheBooks. “Too often the left hand simply doesn’t know what the right hand is doing, and this has led to trillions of dollars in improper payments.”

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Hart blamed nearly $4 billion in COVID-19 stimulus payments sent to dead people Internal Revenue Service don’t check the SSA death database.

He also noted how, in addition to improper payments through the stimulus check program, the Small Business Administration also sent more than $3 billion more to dead people in the form of forgivable loans “to entities on the list ‘Don’t Pay’ from the Treasury Department.

“Congress granting permanent access to the Total Death Master File will significantly reduce fraud, improve the integrity of the program, and better protect taxpayer dollars,” said Assistant Fiscal Secretary David Lebryk. (Kurt “CyberGuy” Knutsson)

“Today’s news is a step in the right direction, but there are miles to go before we reach balance,” Hart said.

After news of the recovered payments was announced, Assistant Fiscal Secretary David Lebryk noted that the findings were “just the tip of the iceberg.”

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“Congress granting permanent access to the Total Kill Master File will significantly reduce fraud, improve the integrity of the program, and better protect taxpayer dollars,” he said.