US Treasury Blocks $99 Million in Erroneous Payments to Deceased Individuals
A new permanent verification system targeting federal waste intercepts thousands of unauthorized transactions before funds are disbursed.
The United States Department of the Treasury has blocked nearly $99 million in federal disbursements from being sent to deceased individuals. This crackdown, executed under a newly deployed screening system, represents a major step in the federal government’s ongoing campaign to curb waste and financial mismanagement.
The initiative, spearheaded by the Bureau of the Fiscal Service, evaluated more than 885 million transactions totaling $2.77 trillion. Through this extensive vetting process, officials flagged and halted over 4,900 attempted transactions before the funds could leave government accounts.
Appearing on Fox Business, Treasury Secretary Scott Bessent highlighted the efficiency of the preemptive strategy, noting that preventing unauthorized transfers at the outset is far more effective than trying to claw back funds after they have been disbursed. Scott Bessent projected that the new verification protocols could block up to $350 million in erroneous transactions by the end of this year.
The issue of improper payments—defined by the federal government as payments made to the wrong recipient, in the incorrect amount, or for ineligible purposes—has long plagued federal agencies. According to the Government Accountability Office (GAO), systemic inefficiencies lead to hundreds of billions of dollars in losses annually. Bessent noted that GAO estimates suggest overall annual losses from fraud and administrative errors could reach up to $500 billion, representing roughly 1.66% of the nation’s gross domestic product (GDP).
The operational framework for the crackdown stems from Executive Order 14249, titled “Protecting America’s Bank Account Against Fraud, Waste, and Abuse.” This executive directive mandated stricter oversight and technological modernization across federal agencies to protect public funds.
Central to the Treasury’s screening process is permanent access to the Social Security Administration’s Full Death Master File. This database contains comprehensive records of deceased individuals, allowing real-time verification before federal checks or direct deposits are cleared.
Historically, federal agencies faced legal and bureaucratic hurdles in accessing this complete dataset. In 2021, the Consolidated Appropriations Act granted temporary three-year access to the database. Recognizing the program’s utility, Congress recently codified this authority into permanent law through the Ending Improper Payments to Deceased People Act, which President Donald Trump signed in February.
Prior to this legislative fix, the government frequently engaged in “pay-and-chase” operations, attempting to recover funds sent to deceased retirees or veterans after the transactions had already occurred. Treasury officials emphasize that upgrading the federal payment system with automated upfront checks is crucial to safeguarding taxpayer resources and reducing the national debt.
