Faulty SSA Database Matches Prompt $500 Million Settlement

Susan Hall

The Social Security Administration has agreed to a $500 million settlement of a class-action lawsuit affecting as many as 200,000 people whose Social Security benefits were suspended on unfounded suspicions that they were fleeing prosecution.


Though federal law allows payments to be withheld to fugitives, the plaintiffs in the lawsuit alleged the the Social Security Administration's automated system that matched up payees with a number of databases of outstanding warrants went too far. It suspended payments in cases of people who had the same name or birth date as a fugitive or who had outstanding warrants for minor offenses such as bounced checks or traffic violations, according to The Los Angeles Times. It says checks were cut off largely to poor, elderly and disabled people who had little recourse.

InformationWeek says the agency plans to insert humans into the process to make sure the computer matches are valid.

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