[retiredguy123]

I don't think the bank did anything wrong. From the SSA.gov website:

"If a beneficiary dies
If the payment is by direct deposit, notify the financial institution as soon as possible so it can return any payments received after death. Family members may be eligible for Social Security survivors benefits when a person dies."

Also, any payments of any type received for a deceased person, must be cashed by the estate executor or by someone who is designated on the account as "transfer on death", in which case, the bank would require proof of death. It would be illegal for anyone else to remove money from an account of the deceased.