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Deceased and Inmates Get Millions of Dollars in Stimulus Payments

Social Security Administration sends $250 checks to thousands who were ineligible to receive them

Last year's stimulus effort helped out a few more people than government officials had in mind.

About 89,000 people who were dead or in prison received $250 stimulus checks intended for older Americans and those with disabilities, according to a recently released report from the Social Security Office of Inspector General.

As part of the stimulus program enacted in February 2009, one-time payments of $250 were sent to recipients of Social Security and a handful of other government benefit programs. In total, about $13 billion in payments were distributed to more than 52 million people.

Now, however, the inspector general's report indicates that the administration sent $18 million worth of payments to more than 71,600 dead people in addition to $4.3 million that went to more than 17,300 inmates.

Many of the incarcerated individuals were in fact eligible for the payments because they were not in jail during the three months used to determine qualification.

As for the deceased beneficiaries, however, the problem stemmed from Social Security's failure to check all databases to ensure eligibility, the report found. In fact, in the majority of cases involving deceased recipients, the administration had been notified of the individual's death. And at least one recipient died four years before payments were sent in May 2009.

"At a time like now, when nearly $350 billion in waste, fraud and abuse in the federal government has been reported and our national debt closing in on $13.5 trillion, these findings represent the epitome of laziness and a total disregard for accountability," said Sen. Tom Coburn, R-Okla.

Ultimately, more than half of the erroneous payments were returned voluntarily. But millions still remain unaccounted for, and there's not much that the government can do about it. That's because the stimulus bill did not allow for reclaiming funds that were mistakenly sent to those who had died.

Despite the problems, Social Security officials stress that the errors represent a small percentage of the total payments distributed. In a written response included with the report, officials said, "We issued economic recovery payments (ERP) accurately to more than 99.8 percent of approximately 52 million eligible Social Security and Supplemental Security Income beneficiaries. We worked with Treasury, developed new processes and began issuing ERPs about 30 days earlier than the legislatively mandated deadline. This was a major accomplishment for our agency."

Michelle Diament writes frequently for the AARP Bulletin.

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