According to a recent CNNMoney report, the Social Security inspector general estimates that the agency has given $40.3 million to deceased recipients.
Normally, family members or funeral directors are expected to inform the Social Security Administration of a persons death. The deceased's identifying information is then added to the agency's Death Master File, a database that contains 87 million death records. Those who fail to report this information risk serious fraud charges.
So if the post-death process is that simple, how are millions of dollars still going to the dead? One in every 200 deaths are entered into the database incorrectly thats 38 very costly mistakes a day. That means even the healthiest, living Americans can be reported dead because of a simple misspelling. In fact, CNNMoney notes that between May 2007 and April 2010, the Death Master File listed 36,657 death entries for people who were very much alive. And even beneficiaries whose deaths have been properly reported simply continue to receive payments anyway.
Maybe we should revamp the system and put people in charge who can actually run a company and correct these errors.