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Millions in US subsidies go to deceased farmers

Investigation finds problem in several agencies

WASHINGTON — The federal government pays millions of dollars in farm subsidies each year to farmers who have died because the Agriculture Department lacks the proper controls to make sure the money it sends is going to the right people, a government audit has found.

The Natural Resources Conservation Service, which oversees the Agriculture Department’s conservation programs, sent out $10.6 million in payments between 2008 and 2012 to more than 1,000 people who had been dead for more than a year, according to the report. The Government Accountability Office, the investigative arm of Congress, said the problem involved several agencies within the department.

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The Risk Management Agency, which administers the crop insurance program, paid $22 million to more than 3,400 policyholders who had been dead for at least two years. The GAO said some of those payments might have been made while the farmer was still alive, but there was no way to know for sure.

The findings were released as the House and Senate prepared to work out their differences on a farm bill that would greatly expand some subsidies, like crop insurance. The report raises questions about the ability of the Agriculture Department to monitor the programs for waste, fraud, and abuse.

The Agriculture Department generally agreed with the findings in the report but said it disagreed with the characterization that it did not have sufficient controls in place to detect improper payments.

‘This irresponsible use of scarce taxpayer dollars reinforces just how broken the system is.’

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Still, the department acknowledged that its controls to identify deceased individuals could be more effective.

Controls over crop insurance, in particular, have been questioned after government investigators found a huge fraud ring last year in North Carolina that for decades siphoned more than $100 million from the program. The fraud ring involved insurance agents, adjusters, farmers, and others.

Environmental activists said the report pointed to the need for changes in agriculture subsidy programs.

“Not only are unlimited crop insurance subsidies flowing to the largest and most successful farm businesses, they are now going to deceased policyholders,” said Scott Faber, vice president for government affairs of the Environmental Working Group, a Washington research organization, which has been critical of farm subsidies. “This irresponsible use of scarce taxpayer dollars reinforces just how broken the system is.”

The GAO said the Agriculture Department had some success in finding improper payments. The department identified payments to nearly 173,000 deceased individuals from 1999 to 2005, the report said. The Agriculture Department recovered about $1 billion in improper payments.

Still, the GAO said more could be done. The auditors suggested the Agriculture Department use the Social Security Administration’s Death Master File to identify payments made to dead individuals. The GAO said the agencies used an incomplete version of the data.

Unless the agencies begin using the full Death Master File, they “cannot know if they are providing payments to, or subsidies on behalf of, deceased individuals; how often they are providing such payments or subsidies; or in what amounts,” the report said.

The Agriculture Department said in May that the Risk Management Agency had begun using a new computer program that compared the full death data to insurance payments.

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