NCPA - National Center for Policy Analysis

Stimulus Checks Sent to the Dead

October 11, 2010

The Social Security Administration (SSA) sent about 89,000 stimulus payments of $250 each to dead and incarcerated people, a new inspector-general's report has found, says the Wall Street Journal.

  • The agency was charged with distributing the one-time payments, worth about $13 billion in total, as part of the economic-stimulus package passed in February 2009.
  • The inspector general found thatabout 72,000 payments were sent by electronic-transfer and as checks to people who would have qualified to receive them -- had they still been alive.
  • The report said that of these payments, about 55,000 were sent because the recipients had died recently, and the SSA had not been informed of their deaths by states, families or funeral homes at the time the payments were sent.
  • The remaining 17,000 mistaken payments were attributed to the SSA failing to properly process death records thatit was aware of.

Another 17,000 payments went to recipients who were in prison at the time the payment was made in May 2009.

There's a startling bright spot in the report:  The inspector general estimates that about 41,000 of the payments were returned.

The downside:  The SSA says that the stimulus package didn't include a provision allowing it to try to retrieve funds that were mistakenly sent out, so it can't try to retrieve the rest of the money.  Money transferred electronically may be sitting untouched in bank accounts of dead people.

The combined total of the mistaken payments is $22.3 million.  About $12 million hasn't been returned.

Source: Louise Radnofsky, "Stimulus Checks Sent to the Dead," Wall Street Journal, October 7, 2010.

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