From the U.S. Government Accountability Office, www.gao.gov Transcript for: Farm Program Payments to Deceased Individuals Description: Audio interview by GAO staff with Daniel Garcia-Diaz, Director, Natural Resources and Environment Related GAO Work: GAO-13-503: Farm Programs: USDA Could Do More to Prevent Improper Payments to Deceased Individuals Released: July 2013 [ Background Music ] [ Narrator: ] Welcome to GAO's Watchdog Report, your source for news and information from the U.S. Government Accountability Office. It's July 2013. The U.S. Department of Agriculture spends about $20 billion a year on programs for farmers like farm income support, and crop insurance. With more than one million program participants, it can be difficult to determine when improper payments are being made, specifically, to recipients who have passed away. A team led by Daniel Garcia-Diaz, a director in GAO's Natural Resources and Environment team, recently reviewed the controls that these programs have in place to prevent improper payments to deceased recipients. GAO's Sarah Kaczmarek sat down with Daniel to talk about what they found. [ Sarah Kaczmarek: ] Let me ask you. How does it happen that the government makes payments to deceased individuals? [ Daniel Garcia-Diaz: ] USDA provides payments to farmers, either direct payments or subsidized crop insurance. And over the course of time, farmers who are enrolled in these programs may pass away, and if nobody notifies USDA, or, the agency doesn't have any particular steps to identify deceased farmers, it is possible that payments or other benefits may accrue to deceased individuals. [ Sarah Kaczmarek: ] What's USDA doing to prevent this from happening? [ Daniel Garcia-Diaz: ] Well you get a very different story depending on which agency within USDA you look at. Two agencies, Natural Resource Conservation Service, or NRCS, and the Risk Management Agency, RMA, we found had no procedures in place to prevent such payments from going to deceased individuals. The Farm Service Agency, FSA, however, had procedures in place and in particular, they had a system where they checked their own databases of farmers receiving payments and they bump that against Social Security Administration's death master file. And so by doing this, they can flag farmers who are deceased. They can follow up and determine whether those farmers actually ended up receiving an improper payment or not. [ Sarah Kaczmarek: ] And FSA provides what type of services to farmers? [ Daniel Garcia-Diaz: ] FSA provides payments to farmers to help support farm income and also to provide disaster relief. [ Sarah Kaczmarek: ] And looking at these three programs, have they had any success with the strategies they've implemented? [ Daniel Garcia-Diaz: ] FSA has actually flagged over 28,000 deceased farmers that received payments in fiscal year 2011 and 2012. Eventually, the state and local offices of FSA determined that about 2,000 of these deceased individuals received payments inappropriately and that amounted to about $3.3 million in payments. The other two agencies, NRCS and RMA, because they don't have a procedure or they can't provide a similar estimate of how many deceased individuals received payments from their programs, but we did compare their program data to the death master file and identified almost 5,000 deceased individuals who received payments. And if both agencies had this information, they would be able to follow up and determine what number of these 5,000 are actually improper payments. [ Sarah Kaczmarek: ] And what's GAO recommending be done to reduce payments to deceased individuals? [ Daniel Garcia-Diaz: ] We're recommending that in the case of NRCS and RMA, that they conduct a similar data matching exercise that FSA does to flag those questionable payments to deceased individuals, and then to develop appropriate policies and procedures to perform a review and determine whether those payments were in fact improper or not. [ Sarah Kaczmarek: ] Finally, for taxpayers concerned about improper payments, what's the bottom line here? [ Daniel Garcia-Diaz: ] Well I think it's important to note that FSA has actually made significant improvements in identifying deceased individuals who have received improper payments, but it's time for the other two USDA agencies, NRCS and RMA, to catch up with their sister agency and implement steps to identify improper payments to deceased individuals, and ensure that taxpayer dollars are used in an appropriate way. [ Background Music ] [ Narrator: ] To learn more, visit gao.gov and be sure to tune in to the next episode of GAO's Watchdog Report for more from the Congressional Watchdog, the U.S. Government Accountability Office.