R.I. congressional candidate Brendan Doherty says federal government has paid $601 million in five years to dead retirees

Brendan Doherty, like a lot of candidates, says if he’s elected to Congress in November he’ll put a stop to "rampant fraud and waste" in government spending.

On his campaign website, the Republican candidate for the First District seat and former head of the Rhode Island State Police, says he’ll use his years in law enforcement  to "shine a light on the unconscionable abuse of hard-earned taxpayer funds."

Among examples of abuse he lists are the purported millions of dollars in pension benefits the federal government distributes each year to federal retirees who are, well, dead:

"Over the past five years the federal government has paid out $601 million in retirement and disability benefits to deceased former federal employees."

We’ve heard stories of dead people voting before, but are they also getting hundreds of millions in pension payments? We called Doherty’s campaign to find out where the candidate got his information.

Spokesman Robert Coupe told us he thought the $601 million figure was pretty large when he first heard it from campaign staffers. He said it came from "Wastebook 2011," the latest edition of an annual compilation of questionable government spending put out by Sen. Tom A. Coburn, R-Oklahoma.

We checked "Wastebook 2011," which indeed mentions "over $601 million" paid out to deceased federal workers in the last five years, with footnotes citing the source: a report issued by the U.S. Office of Personnel Management’s Office of the Inspector General, titled, appropriately enough, "Stopping Improper Payments to Deceased Annuitants."

According to the Office of Personnel Management’s report, "the amount of post-death improper payments is consistently $100-$150 million annually."

Some of what the federal government calls "improper payments" is outright fraud -- people with electronic access to the deceased’s bank accounts taking the money. And some of it is because the money was electronically transferred into what are now inactive bank accounts. The money can sit there piling up for years before anyone notices.

Special efforts have been under way since at least 2005 to reduce payments going to dead retirees and their survivors, the report says. Those efforts have included matching the rolls of eligible recipients with the Social Security Administration’s death records on a weekly and annual basis, doing similar checks with the IRS to see who’s still filing returns, and random phone calls to retirees over 90 years old just to make sure they’re still around.

Those steps have helped identify the scope of the problem, Susan L. Ruge, a spokeswoman in the Office of Personnel Management’s inspector general’s office, said in an e-mail. In fiscal year 2010, for instance, the office identified $116.8 million in improper payments going to dead retirees or survivors.

But solving the problem is another matter.

According to the Personnel Management’s report: "There remains a high probability that egregious loss of monies from the [civil service] fund will continue and require strategic corrective actions."  It notes one case of a man illegally pocketing more than $515,000 by cashing in his dead father’s monthly retirement checks -- for 37 years.

Ruge said 94 percent of annuity payments are transferred electronically into bank accounts as opposed to the older method of mailing checks. The office of inspector general, she said, has no breakdown as to payments stolen by others with access to those accounts and money lost by languishing into those unattended accounts.

"In overpayment cases where no theft has occurred, there is greater potential for EFT (electronic fund transfer) overpayments to continue undetected, simply because no one is monitoring the deceased annuitant’s bank account," said Ruge.

If there is good news in any of this it is this: while $601 million going to dead people in the last five years sounds like a lot of money, it represents less than 2.5 percent of all civil service retirement disbursements, the report claims.

Our Ruling

Doherty’s website says "Over the past five years the federal government has paid out $601 million in retirement and disability benefits to deceased former federal employees."

The campaign accurately quoted a figure whose source is a report issued by the U.S. Office of Personnel Management’s Office of the Inspector General.

We rate his statement True.

Rhode Island’s former top cop is setting his bar of expectation pretty high if he’s promising to curb this kind of  "rampant fraud and waste." We’ll be watching.

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