I think retirement is a pipe dream...

Many? doubtful. Sorry you had to deal with that, but the vast majority of plans pass on to heirs. A true 401K is your money. Employers match a certain amount, but the majority of the money comes from your own pocket.

Are you sure you’re talking about a 401k??? Your father’s contributions can’t just be taken from his beneficiaries/heirs.

There’s something off here. I’m not sure what you’re referring to as “death benefits “.
Yea this needs to be looked into. Not transferring benefits to the beneficiary is straight up illegal.