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  • Food Stamp Fraud Costing Taxpayers Billions

    The Washington Examiner recently reported that the two states bordering the nation’s capital are two of the five worst states for food stamp fraud.

    The above table shows the inverse relationship between the number of food stamp recipients and the percentage of cases investigated for fraud in Virginia, Maryland, and the District of Columbia. While the number of food stamp recipients has significantly increased (now up to a total of 45 million Americans) the percentage of cases investigated for fraud has not increased or even remained constant. The result is that fraudsters are duping taxpayers of millions, even billions, of dollars.

    According to fiscal year 2010 data collected by the U.S. Department of Agriculture, Maryland and Virginia distributed about $130 million in food stamps to individuals who were not eligible. For every $100 in benefits, those two states doled out $6.11 and $5.04, respectively, to those not eligible. The national average for that time was $3.05.

    Inefficiency in the food stamp program spending is costing taxpayers billions. Of the $64.7 billion spent on the program last year (a record high that is only slated to increase), an overall $2.5 billion was spent on improper food stamp payments.

    Another recent audit by the Department of Agriculture on the state of Kansas showed three major sources of inefficiency in the distribution of food stamp funds. While many recipients had invalid Social Security numbers and were double-dipping between federal and state programs, many of the recipients also happened to be dead. This has become a pervasive problem in the realm of government benefits. (The Social Security Administration also sends millions of dollars to recipients who are dead.)

    Beyond protecting against fraud, the federal government should ensure that food stamps—not to mention the roughly 70 other federally funded welfare programs—are helping individuals become self-reliant rather than dependent on government. Half of food stamp recipients have received the benefit for 8.5 years or more.

    Fortunately, some lawmakers are taking action. Representative Jim Jordan (R–OH) and Senator Jim DeMint (R–SC) are proposing legislation that, among other things, would attach work requirements to food stamps. The legislation would also roll back total welfare spending—which now stands at nearly $1 trillion per year—to pre-recession levels once the unemployment rate recedes to 6.5 percent.

    Additionally, in a recent letter to the Joint Select Committee on Deficit Reduction (the “super committee”), Senator Jeff Sessions (R–AL) pointed to the food stamp program as an area with great potential for reform:

    Like welfare reform in the 1990’s, smart reforms to the food stamp program will improve outcomes and help more Americans achieve financial independence. Unmonitored welfare programs, over time, can hurt the very people we are seeking to help.

    As Ronald Reagan noted in 1968, “We should measure welfare’s success by how many people leave welfare, not by how many are added.” He also stated in 1970 that “welfare’s purpose should be to eliminate, as far as possible, the need for its own existence.” Unfortunately, the federal welfare system fails to accomplish this purpose. Welfare reforms that promote work are key to achieving the goal of helping those in need become once again self-reliant and independent.

    Kevin Reagan is currently a member of the Young Leaders Program at the Heritage Foundation. For more information on interning at Heritage, please visit: http://www.heritage.org/about/internships-young-leaders/the-heritage-foundation-internship-program

    Posted in Economics [slideshow_deploy]

    30 Responses to Food Stamp Fraud Costing Taxpayers Billions

    1. Bobbie says:

      thank you!

      it's true the worst run countries have the most dependent on government! yuck! how about for everywhere government subsidized money is accepted, that business take the loss instead of the unknown tax payers handling their own matters responsibly that aren't involved and shouldn't technically be taking the loss?

      Just like the Hippocratic oath of the doctor who's pro bono services shouldn't be an increase cost on those that responsibly cover their own. The facility should make up the costs in their own way like they did before outside government got involved.

    2. This is very tragic. It also very funny. A week or two ago while driving my daughter to school, I was listening to a local morning radio show. The host was interviewing the NYC council president about the tougher proposed requirements for singles not families to get into the shelter program. And one of her major complaints was the need to show ID and the need to prove that they had nowhere else to go. But she was really apoplectic about having to show ID. She even went so far as to say with the use of a "debit" card instead of actual food stamps that there was no fraud

      Come on now you need photo ID for everything these days library, medical care, cashing a check, senior discount, driving It's every where but the left refuses it for benefits and voting, both areas that have fraud, waste and abuse.

      You even need ID to get into some buildings.

    3. Stirling says:

      The bigger a Government becomes, the more fraud and corruption occurs within it's bloated programs (which never seem to get abolished or removed.) Since government has no incentive to reduce the fraud (due to having a tax base and printing press) the abuse continues until the currency becomes worthless. Also the bearucracy needed to police the fraud also grows and adds to the government size.. It would be nice someday to actually see a reduction in this "Nany State" growth but the government has a lousy track record to belive anything with seriously be accomplished in the end.

    4. Deirdre Mundy says:

      One huge problem with food stamps is that they discourage saving and encourage consumption. In an ideal world, families would use the money saved by not having to buy food in order to get an education, relocate to an area with jobs, etc. But since the program doesn't allow recipients to have more than $2000 in a bank, it discourages thrift. Instead, it subsidizes behaviors (instant gratification, lots of consumption) that mire families in poverty.

      If we want to help people get OFF government assistance, we need to structure the program in such a way that it encourages and teaches 'middle-class values."

      • heather says:

        So then basically, have the government give more money to the people who don't work and already get everything for free, to put in their savings account? My husband and I work our asses off, both go to college full time, don't make crap for income, we literally spend every single dollar we have ON BILLS, we now have $100,000 in student loan debt. Where is OUR help? Where is OUR food stamps and cash assistance? We will never be able to buy a house b/c we will never have money to save up for a down payment and we will never afford a mortgage.

        I guess I should have gotten pregnant, not taken this job I'm working full time at, and not got married. Had I been irresponsible, I would have gotten everything for free EVEN school.

    5. Frank from Florida says:

      Bread and a circus for the masses. What incredible pandering on the part of all our politicians!

    6. Thomas says:

      •Free school lunch kids waste 46% more food than regular price kids. How can poor kids be hungrier?
      •School lunch waste is about 30%. Where’s the hunger?
      •School lunch provides all the calories a kid needs; then poor kids go home and eat the food stamp pop, candy bars, take-and-bake pizza and donuts.
      •A family of 6 can get $23,900 per year in food stamps, free school food and food bank food. A non-recipient family of 6 usually spends $11,500 per year on food.
      •A family of 6 can earn up to $55,000 and qualify for food stamps and Women, Infants and Children, WIC.
      •The poor are adding weight faster than the non-poor.
      •Arguments as to why the poor make bad choices with food stamps do not stand scrutiny.
      •The food stamp program this year costs $77 billion. Mr. Obama wants to add $9 billion to that. A healthy food list reform, along the lines of the WIC program, could cut spending in half; no recipient would go hungry and the nation’s deficit would be substantially reduced.
      •At least 57% of food stamp spending is for foods high in high fructose corn syrup, cholesterol, fat and sodium. Food stamps buy unhealthy food.
      •The USDA and the Obama Administration are aggressively expanding food stamps, free school lunch and after school supper.

      • auntvick says:

        AND they give big blocs of money to states that have higher numbers of food stamp recipients. Therefore they want to sign up more and more to get this money for their states and they all get raises! I read this about Oregon a few months back. This needs to stop.

        • Wanda Callberg says:

          Yes — it is scary! I live in a high-end neighborhood in Brooklyn, NY (houses sell for several MILLION dollars). In the small, local stores, people pay for their groceries with food stamps, then pack them into a Mercedes SUV or walk them home to their multi-million dollar dwelling. Why can't there be people hired to police these areas — like the 'old' notion of tax collectors? Why are certain social groups allowed to get away with this blatant fraud????

    7. James Jones says:

      If you're poor and need help, that's fine.
      However, we should hand out bulk packages of items like dried beans, rice, oats, powdered milk and maybe a little salt pork for seasoning. You have no right to be eating prepared foods (you've got all day to cook) or dining out while using my hard earned money.

    8. There are a lot of government programs that need looked into not just food stamps!

    9. Alex says:

      I went to Kroger a few weeks ago and the family in front of me used their food stamp debit card to pay for the groceries. They were parked next to me in a new Lexus outside. The fraud is not only in the use of the card but also in who signs up for food stamps and how they use the system.

      • Absolutely. It just burns me up. And it's never going to change until REAL welfare reform is undertaken. The first thing that needs to happen is for the federal government to get completely and totally out of it. The only involvement of federal government would be verification of immigration status (and with the right tools in place,even that could be accomplished through state-level agencies.) There should be stricter standards and an interstate networking process for each state agency implemented.Each state should be responsible for their own child support enforcement,and other stopgap measures could be put in place. Last year, I drafted a contract that could very easily be implemented that would help get more people off welfare,learn a trade,drastically reduce the length of time a person could be on welfare and to cut down on fraud and waste.It would even help create jobs!
        Here it is….
        Here's my idea of welfare reform:
        (document presented in language of applicant)…..Public Assistance Implementation and Usage Contract.

        This contract, entered into on (date) and expiring on (18 months from implementation date) by the (state agency) and applicant(s) listed herein (must submit names of applicant and children born to her via birth records),allows for the provision of food,housing allowance,child care and education for the purposes of job placement during the contract period,and is understood by all parties concerned that the provision of aforementioned assistance is on a one-time basis,not to be repeated or reinstated at any time for any reason between the applicant(s) and the agency named herein,and is for the aforementioned time period only,and can only be implemented following presentation of documents proving legal citizenship status and a drug screening process,both of which are to be conducted by the agency.

        Once legal citizenship status and drug screen results are known by the agency and the applicant and found to be favorable,this contract can then be implemented.The following covenants hereby apply and are agreed upon by both the named agency herein and the applicant(s) seeking assistance (failure of any one of these covenants will be considered a contract breach on the part of the applicant,and will result in immediate termination of the contract;assistance will be terminated immediately and can never be reinstated at any time in the future for any reason:

        Applicant MUST disclose the name(s) of the absent parent of applicant's child/children so that an attempt to obtain monetary support for those children can be made through DNA analysis. Failure to disclose the absent parent's name will result in automatic immediate cessation of benefits.

        applicant will submit to random home visits which will be unannounced and will occur during the 5-day work week,normally during the early afternoon hours;

        applicant will submit to random drug testing as directed by the agency;

        applicant must not conceive,adopt (formally or informally,including family members,immediate or extended) marry or cohabitate during the contract period;

        applicant must attend a one-year vocational program via a voucher provided by the agency;applicant must attend each class ( two absences will be allowed during the contract period and a doctor's note must be submitted upon returning to class for each absence) and a transportation voucher will be provided by the agency for transportation during class hours;child care will be provided by the agency during class hours only.

        Once applicant graduates from vocational training, a two-month job-placement period will commence,with child care provided by the agency; Upon applicant's employment,there will be an additional 4 months of ongoing assistance to allow applicant enough time to establish themselves in their occupation and to make child-care arrangements for after the contract period.

        Once this contract has reached its expiration date,the assistance provided,all provisions and covenants and financial considerations as well,will cease and terminate permanently.The applicant is barred from any and all future assistance.

        I,________________ hereby agree to adhere to all covenants,rules,etc of this contract. I realize and fully understand that I am bound by this contract in order to receive assistance in any form,and that any violation or breach will result in my not receiving any form of assistance any further. I agree further that this contract was fully explained to me by the agency caseworker and that I will fully comply. (sign & date here)____________________________

        Agency hereby agrees to and will implement to the best of its ability and obligations,all covenants of this contract.

        (agency sign & date)_______________________

      • Jeff says:

        I saw the same thing Alex, except they walked outside into their new Mercedes Benz.

    10. some perspective says:

      There are 13.5 million people in MD and VA. Assuming the article is correct that there are $130 million in questionable payments, these payments still account for less than $10 cost per person. Err on the side of doing good. Missing out on two cups of coffee in a year is worth it for a program that helps 1 in 7 of your friends and neighbors.

      • Excuse me? Nearly half of all Americans are on welfare or some other type of assistance,and funny,I don't see half of Americans looking like they're denied anything.The madness has got to stop. And why should I miss out on two cups of coffee a year,when i worked for the money to buy that coffee,just so my "friend" or "neighbor" can lay up with her boyfriend,push out kid after kid and live the high life without ever earning a penny? No thanks! And you're going on the assumption that YOUR figures (whatever liberal website you got them from) are correct. If you want to give up your paycheck to feed the "needy",go right ahead.I for one am SICK of it.

      • Laura W. says:

        Sounds fairly reasonable, but if it's just enabling bad habits, how can the program as it's currently structured be considered to be helping them? (See post by Thomas above.)

    11. Jamal says:

      The food stamp requirements are very messed up. They keep people on the program by punishing them if they save money or keep it invested in their retirement. So what happens is people empty their meager retirement accounts, savings accounts, and checking accounts in order to qualify. This makes them even more dependent and less self reliant. If you have a small retirement or saving account it is more beneficial to empty it- spend it on something- and become eligible for food stamps than to progress more towards self reliance. I think it needs to be tied to unemployment, raise the eligibility cap of $2000, and promote saving. I think there needs to also be application and work requirements and drug testing.

    12. Marie Arnold says:

      I remember once when our four children were young, we were at the checkout buying whatever was on sale that week as the main courses of our meals. I was a stay at home mom by choice so things were tight. In front of me in line was single lady with several kids, well dressed, with a fellow who looked a lot like the kids. They had tons of 'nice' food and whipped out the Food Stamps. When the cashier politely told the lady that dog food was not allowed on Food Stamps, the lady retorted to her older boy, 'Here, take this back and get some steaks for the dog'. And he did. Yes, we see it in our city all the time…people who have LOTs of nice clothes, manicured fingernails, live togethers. owners of nice cars etc..live on our buck….maddening. And, don't even get me going on the abuse with taxes and earned income credit!! (VA resident…would love to see work for food programs…except the elderly or disabled, and I do not mean 'crazy checks' or learning disabled…which is yet another area filled with abuse. )

    13. Rick says:

      A civilized society ideally would always provide for the aged and the infirm. A socialized society, ultimately, will enslave us all…

    14. Charles Axtell says:

      Why is it that only Virginia seems to have taken actions to pursue fraud via prosecutions and administrative hearings, while Maryland did much less and DC did nothing whatsoever?!

      • Because Maryland and DC are the provinces of the entitlement generation,and are largely Democratic leftist enclaves.The Democrats are the party of entitlement,because that keeps voters loyal and keeps them in power. The idiots who continually vote them in time and again are too stupid to realize they're being used and as long as they can keep getting "free stuff",they'll remain loyal voters.Problem is,when the "free stuff" train grinds to a halt and the teat dries up,we will ALL do without,but the Dem leftists will still be in power,and we will have long since lost our leverage against them.That's what is known as Socialism.

    15. Jeanne Stotler says:

      D.C. has been a large welfare state for a long time, the former "Times Herald" wrote articles on checks being cashed in liqour stores and traded for dope, even kids hungry and dirty while the "Moms" drifted from bed to bed. That was 2 generations ago and it's no better only some have moved into the subs of D.C. ie: Maryland and Virginia. There are more on Food Stamps now because illegal's can get them, plus the unemployment of private contractors, ie: painters and repairmen, whose jobs are non-existant in this economy, these same people do not count when unemployment rate is generated as they only base it on those who are getting benefits, self-employed do not count.

    16. Lloyd Scallan says:

      Why has no one investigated the connection between the increase in food stamp recipients and the increase in Democrat voters?

    17. steve h says:

      We could save a lot more if we went after the abuses of the top corporations and the super rich who abuse the system and tax code. As usual, those super wealthy are able to get their pawns scream about the scraps at the bottom instead of seeing something that will make a real difference.

      I also love all the convservatives who are against abortion, but are also against welfare programs that care for those unwanted babies. Mindlessness.

      • Bobbie says:

        steve h what is saved by you or me going after abuses of top corporations? aren't we paying the government to "oversee" corporate abuses? How come government members accuse corporations but do nothing they took the responsibility to do to correct? Why is government worth a penny of anybody's dime when they're adding corruption within government control to what you claim is corrupt in business you have a choice to deal with or make it none of yours?

      • Genee Valin says:

        Amen to that! I am a cashier–and get SO nauseated to watch these "so called" poor eating BETTER than me on MY hard earned money. What is WORSE is that 99% of these slackers are MORE than well enough to get a job. They can afford cigarettes, lottery tickets, nails, hair, booze etc, they can afford to pay for their food.

    18. abin go win says:

      Please report to your county officials if u see or know of fraud with Public Assistance Programs! The cheaters need to be stopped!

    19. Andrew Lin says:

      I think the biggest scam of the Food Stamps program is how much JUNK you can buy with it. I rarely see someone using food stamps on healthy foods. Most likely it's boxes of cereals filled with sugar, chips full of hydrogenated oils, SODA (a favorite of food stamp people!), and dairy products. It's neither food nor an entitlement — it's designed to get the food stamp receipients brain-dead so they can vote for politicians who keep giving out poison.

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