- 8 min read
Updated: Mar 9
This story is possibly about the biggest scandal in the history of American politics. But there are many surprises in this story. It’s necessary to get all the way to the end to fully understand what happened and see the shocking conclusion.
THE DISCOVERY
Elon Musk reported that the DOGE team discovered that there are more eligible social security numbers on the Numident file than there are citizens in the US! He suggests that this may be the biggest fraud in history. (1, 2). His post features a chart indicating there are more than 20 million listed with ages 100 and higher, including more than 3.9 million in the 130-139 age range, more than 3.5 million in the 140-149 range, and more than 1.3 million in the 150-159 range!
The Trump administration is suggesting that tens of millions of dead people over 100 years old are receiving Social Security payments. Over the past few days, President Donald Trump and billionaire adviser Elon Musk have said on social media and in press briefings that people who are 100, 200, and even 300 years old are improperly getting benefits—a “HUGE problem,” Musk wrote, as his Department of Government Efficiency digs into federal agencies to root out waste, fraud, and abuse.
Larry Kudlow reported on Fox News that Elon Musk and DOGE are finding fraud everywhere (3). Larry Kudlow was an associate director for economics and planning in the Office of Management and Budget (OMB) in Reagan's first term. He was a Director of the National Economic Council in Trump's first term. How much fraud did he think was discovered? He invited Robert Sterling, a marine veteran and mergers and acquisitions specialist, to make an estimate. Mr. Sterling used an estimate of an average retiree getting $2100 per month, and he calculated that the more than 20 million people with social security numbers over the age of 100 are collecting 522 billion dollars per year!!! That is more than 1/3 of all Social Security spending for people over 100 years old!!!. This story has quickly circulated online around the US (4, 5, 6, 7). The story quickly spread around the world, including Ireland (8) and India (9, 10, 11). Kevin O’Leary, one of the well-known Shark Tank investors, has mentioned that the US government has not been audited in 100 years!!!
Oh my, more than a half trillion dollars of fraud and no audits for 100 years. Maybe it's worthwhile to take a closer look at the facts.
THE FACTS
Actually, Kevin O’Leary is a big Trump supporter who narrowly escaped prosecution for a cryptocurrency scam. He is not aware that every major government agency has an independent inspector general whose job it is to audit the agency. And the government accountability office has been doing audits for more than 100 years. (14).
The estimate of $522 billion by Larry Kudlow and Robert Sterling was based on some significant assumptions. It was assumed that every Social Security retiree is collecting an average of $2100 per month. Anyone who retired more than 40 or 50 years ago would certainly be getting much less because incomes were much less many decades ago. An extreme example is Ida May Fuller, the first person in America to collect social security. She was born in 1874. She started collecting social security in 1940 and stopped in June 1975 when she died. She collected $22,889 over 426 months for an average social security check of $53.73. But more significantly, Kudlow and Sterling never asked single the most important question—how many of those people with social security numbers over 100 are actually collecting payments? Mr. Kudlow actually studied history in college and spent much of his life pretending to be an economist. And Mr. Sterling apparently is not very good at financial analysis either. Their estimated fraud was nowhere close to accurate.
The main reason why the number of social security numbers is larger than the current population of the US is because the people with the oldest social numbers have died.
There are a number of reasons why there are too many social security numbers. Before 1962, there was no automated method of reporting death notices to the Social Security Administration. And the social security numbers are used for other purposes in addition to social security payments. Some people that are victims of identity theft apply to get another social security number. In some cases undocumented immigrants are using social security numbers of dead people to work. But they can only pay into Social Security, but they cannot collect from Social Security.
2015 Inspector General Report –Social Security accounts with Age 112 or Older Who Did Not Have a Death Entry
In 2015 there was an inspector general report about 6.5 million social security number holders with ages over 112 that had no death information (14). The auditors wrote, “ We acknowledge that almost none of the number holders discussed in the report currently receive SSA payments." The fact that almost all of the 6.5 million number holders aged over 112 had no earnings and received no payments from SSA further indicated the individuals were likely deceased. Of those 6.5 million, SSA issued payments to 266 number holders — though the IG's review indicated only 13 beneficiaries were likely age 112 or older, while in the remaining 253 cases, there were discrepancies in SSA's records that indicated the beneficiary wasn't actually that old. In some cases, there was a death date on the member benefit records (MBR) but not on the Numident file.
In the past, e-verify requests from employers had identified workers trying to use social security numbers of people that were over 100 years old. The 2015 audit showed about $3.1 billion in earnings reported by employers or self-employed individuals who were not the actual original Social Security number holders. The Cato Institute vice president noted that a lot of Social Security numbers for people older than age 100 were “illegal immigrants paying in, not fraudulent recipients taking out.”
The Social Security Administration agreed with 2 of the 4 recommendations from the inspector general's report. As of September 2015, the SSA began to automate terminating benefits once people reached age 115 (15). If a real person had the wrong age recorded for their age, it must be corrected before getting further payments.
2021 Inspector General Report—a report on deceased beneficiaries in suspended payment status. (16).
The inspector general made 9 recommendations for improvement, and the Social Security Administration agreed with all of them. In 2021, Congress approved the Department of the Treasury to have temporary access to the Social Security Death Master File. The result is that there is now a 3-year program involving the Treasury Office of Payment Integrity to prevent fraud (2023-2026).
2023 Inspector General Report—Number Holders Age 100 or Older Who Did Not Have Death Information on the Numident (17)
Numerous audits have reported that there are a significant number of social security numbers without death notices. But audits have indicated that there is not a large number of frauds using these old social security numbers. Over 98% of the social security numbers for people over 100 are not collecting any payments at all.
An audit in July 2023 showed that 18.9 million people were listed as 100 years or older. Roughly 18.4 million uncovered in the 2023 audit had not received benefits or reported income for 50 years, meaning they were likely dead. Most likely they died decades ago—before the use of electronic death reporting. Around 44,000 were actually receiving benefits, with 13 of those older than 112. At that time there were approximately 86,000 people over the age of 100 living in America (US census), but only 44,000 were collecting social security. This is far different from the recent suggestion from Elon Musk that social security payments are made to 20 million social security accounts with ages over 100.
In the previous 7 years, less than one percent of Social Security accounts received improper payments. Some are overpaid and some are underpaid. But the problems usually involved living people, not accounts of dead people. At that time the Treasury Department had already begun operating the do-not-pay portal to detect and prevent improper payments.
“Some people have more than one number, occasionally because they’re committing fraud, but more usually because they’ve had fraud committed against them and they were issued a new clean number.
In tax years 2016 through 2020, employers and individuals reported approximately $8.5 billion in wages, tips, and self-employment income using 139,211 SSNs assigned to individuals aged 100 or older. SSA transferred these earnings to the Earnings Suspense File, primarily because personally identifiable information provided on the workers’ earnings reports did not match the information in SSA enumeration records. This is most likely from undocumented immigrants who can pay into Social Security but cannot collect from it.
The inspector general recommended several ways to update the SSN records in the Numident file that have no date of death. The Social Security Administration disagreed based on an estimate of 5-10 million N$ to fix the problem and the fact that almost none of these accounts are receiving any payments. But there are ongoing programs to detect and prevent other types of improper payments.
2024 Inspector General Report—Preventing, Detecting, and Recovering Improper Payments (18)
The inspector general reviewed the progress that the SSA has made in working with the Treasury office to prevent improper payments and made additional recommendations.
2025 Inspector General Report—Audit Recommendations that Had Not Been Implemented (19)
This report includes a review of many inspector general recommendations that have not been implemented. In most cases, there are not clear estimates of the cost of implementation.
THE DOUBLE DOWN
Lee Dudek, who was named acting chief of the Social Security Administration after the resignation of Michelle King. He has denied the suggestions of Trump and Musk that millions of dead people are collecting social security payments. “The reported data are people in our records with a Social Security number who do not have a date of death associated with their record. These individuals are not necessarily receiving benefits,” he said (20). Numerous news sources have reported on this fake news story, including Snopes, factcheck.org, USA TODAY, MSN, Time, Newsweek, AP, Yahoo Finance, CNBC, Barrons, and even FOX News and The NY Post, who have published many fake news stories in the past, have denounced the DOGE social security fraud story (21). Only the most firmly committed fake news sources have been pushing this story (12, 12a, 12b, 12c).
The Office of the Inspector General has made serious audits of the social security system and provided numerous recommendations for improvement. The SSA has worked with the treasury office to have better control of improper payments. The most surprising fact is that Musk and the DOGE team have not only not discovered large-scale fraud in social security, but they have not discovered any problems that were not already known and are being worked. And they have made no practical suggestions to fix any problems. They had only contributed to a fake news story about fictitious payments to 20 million dead social security account holders. And now the independent inspector generals who made so much progress in controlling improper payments have been fired, so there will not be anyone honest auditing the SSA.
The Social Security Administration is one of the most efficient federal agencies. Their administrative costs amount to just 0.4% of total spending, down from 1.6% half a century ago (22). General and administrative expenses at Musk’s Tesla Inc. are 4.6% of revenue. It's outrageous that the richest man in the world wants to cut government services to the poor and middle class to justify bigger tax cuts to billionaires.
And regardless of how many times this fake news story of huge social security fraud by dead people has been debunked, the White House and Trump continue to double down on that story (23, 24, 25).
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