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Waste of the Day: Feds Paid $1.3 Billion To Dead People Last Year

April 02, 2024

Topline: The federal government mistakenly paid $1.3 billion to dead people in fiscal year 2023, according to U.S. Office of Management and Budget’s reporting on improper payments.

Key facts: Some living souls collected checks for the deceased through alarming examples of fraud at the expense of the IRS, Veterans Affairs Department and Medicare, the Washington Times reported.

Open the Books
Waste of the Day 4.02.24

One Washington man, Raymond Kenneth Musgrove, impersonated a Vietnam veteran for more than 25 years to collect his disability and health care benefits, the news outlet reported.

When the real veteran died in 2018, the VA cut off benefits — until Musgrove convinced them the veteran was still alive.

Payments stopped again once the VA inspector general found the veteran’s tombstone in an Oklahoma cemetery, but Musgrove somehow duped the VA again and payments restarted, the Times reported.

Musgrove collected $825,000 before his indictment this February.

A woman in Ohio kept a similar scam going for 48 years, lying to the VA seven times to collect benefits for her dead mother, until being caught in 2021, the newspaper said.

Background: Not all improper payments are quite so amusing, but they do amount to a staggering amount of taxpayer money thrown down the drain.

OpenTheBooks previously reported that the federal government spent $2.9 trillion on improper payments between 2004 and 2022, adjusted for inflation. That’s 8% of the current $34.5 trillion national debt.

Another $236 billion was incorrectly paid in 2023, according to the Government Accountability Office.

Of that, $1.3 billion were payments made to dead people.

Summary: While completely eliminating improper payments is unlikely, cutting off funds after seeing the beneficiary’s tombstone is a good place to start.

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com

This article was originally published by RealClearInvestigations and made available via RealClearWire.
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