I've heard of financial claw backs, but never where they had to use an actual backhoe.
The article tells us that North Carolina's retirement system director wants the state, in accordance with applicable law, to turn to the families of dead state employees who received too much money from benefits. It was discovered in an audit that some employees were overpaid when other benefits such as workers' comp and social security were not properly calculated in the determination of their benefits due. The dollars they are talking about are not insignificant. The state estimates that 60 employees were overpaid in excess of $1 million.
The living ones are being hit with a reduction in their monthly check until the overpayment is corrected. The dead ones, despite what appears like an ironclad way to escape the obligation, aren't getting off that easily. The director has instructed his employees to pursue reimbursement from the estates of the 50 workers who up and died before this error was identified.
I don't blame the state for pursuing the collection. It is money that belongs to the taxpayers of North Carolina, and they are simply following established law in the recouping of those funds. We can, however, be critical of the original error. It sounds pretty damn sloppy, to be honest. The current administrators are blaming the previous administration, if that helps at all.
I do feel sorry for the relatives that now unexpectedly owe the state money for something they likely knew nothing about. I would hope and suspect that the state will be cognizant of the delicate situation it has created. I would recommend they not attach a court summons to the sympathy bouquet sent to the funeral home. Similarly, seizing the casket as an asset of the estate could prove pretty awkward during the interment.
God help their remains if they were buried with their wedding rings.
I wonder how the initial notifications for the descendants are worded.
“We are sorry for your loss. Now let us tell you about another.”
“Remember Aunt Midge? Funny story. She wasn't the financial wizard you thought she was.”
“MacArthur to the Philippines. Hillary to politics. Your inheritance from Uncle Joe. What do these things have in common? They have all, or shortly will be, returned.”
As sad as this may be, it is an unavoidable fact in the world of benefit management. Screw up, and someone somewhere will have to pay. It is unfortunate that for its recovery efforts, the Retirement System Division of the North Carolina Department of State Treasurer not only sees dead people, but will have to sue them as well.
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