Focus on Dead EBT Users Masks Shocking Details of DTA Report – Up to $427M Potential Annual Fraud

( – promoted by Rob “EaBo Clipper” Eno)

Sometimes it takes a second look at a story to realize the real magnitude is buried by the quick headline.  Yesterday, I fell into that trap.  As multiple news outlets reported that over 1000 dead people received EBT benefits of over $2,000,000 I put up a quick link to those stories, and added a zombie themed picture.  Tonight, after reading the report it’s worse, much worse than the quick and easy headline.  

According to the Auditor, the Department of Transitional Assistance doles out $1.29B in benefits annually as of 2012. The Auditor uncovered that up to $427M annually or over 1/3 in potential fraud, that was not investigated.  It is important to note this isn’t the total amount of fraud, just the potential fraud.  The Auditor says that no attempt was made to investigate any of it.

Here are the numbers:

$1.103M annually in benefits to dead recipients.  The $2.39M in benefits to dead people was for a time period of 26 months. (Page 2)

We found that, from July 1, 2010 through April 24, 2012, 1,164 recipients receiving SNAP, TAFDC, or EAEDC benefits were deceased or were using a deceased individual’s Social Security Number (SSN). We estimate that these 1,164 recipients received approximately $2.39 million in questionable public assistance benefits during this period.

$294,222 paid to people using multiple SSN’s to double dip for benefits. $662,000 was paid out to double dippers over 27 months. (Page 3)

For the period July 1, 2010 through September 30, 2012, we identified 26 individuals who were using two SSNs. These individuals all had two SSNs and separate active payment streams associated with them, yet had the same name, lived at the same address, and were approximately the same age. We determined that over $662,000 in questionable payments had been received by these recipients during this period.

More after the jump  

 

$159,555 per year given to different people who use the same SSN.  $359,000 was given in benefits over 27 months. (Page 3)

We determined that, from July 1, 2010 through September 30, 2012, 21 SSNs were being used by more than one individual. These individuals had the same SSN, yet had different names and different dates of birth. We determined that over $359,000 in questionable payments had been received by these recipients during this period.

$56.7M per year in questionable even dollar transactions.  $56.7M in even dollar transactions were uncovered in a 12 month period.  The Auditor says the DTA did not flag these transactions for review. (Page 3)

Through our analysis of monthly Even-Dollar Transaction Reports from September 2011 through August 2012, we determined that 145,276 recipients engaged in 333,379 transactions totaling $56.7 million in even-dollar SNAP purchases at 2,863 retailers throughout the Commonwealth. Because food purchases seldom end in even-dollar amounts, such transactions may indicate instances in which recipients and retailers are engaging in the trafficking of EBT card benefits by exchanging a participant’s SNAP benefits for cash. Although this monthly management report is available to DTA, it was not being used to monitor this activity during our audit period.[emphasis added]

$54M annually in out of state activity. In a six month period $27M in out-of-state transactions were identified.(Page 4)

Through our analysis of monthly Out-of-State Activity Reports, we determined that for the six-month period November 2011 through April 2012, recipients accessed more than $27 million via 666,767 transactions in cash and SNAP benefits outside of the Commonwealth. Although such transactions are not necessarily a violation of the law, they could potentially indicate instances in which recipients might be violating program regulations by receiving duplicate benefits in another state during the same period and/or by no longer being a Massachusetts resident. Although this monthly management report is available to DTA, it was not being used to monitor this activity during our audit period. [emphasis added]

$32M annually in single transaction full benefit withdrawals.  $24M reported over a nine month period. (Page 4)

Through our analysis of monthly Full SNAP Balance Withdrawal Reports from October 2011 through September 2012, we determined that 50,320 recipients conducted 102,704 transactions totaling $24 million at 1,956 retailers in full SNAP withdrawals. As outlined in a 2007 report issued by the United States Government Accountability Office, such withdrawals could indicate instances in which SNAP recipients exchanged their food benefits for cash. Although this management report is available to DTA, it was not being used to monitor this activity during our audit period. [emphasis added]

$12.8M annually in manual, non-swipe, EBT card number entries. $9.6M over 9 months. (Page 4)

Through our analysis of monthly Manual Card Entry Reports during the nine-month period January 1, 2012 through September 30, 2012, we determined that there were 76,727 recipients who processed 320,101 manual card transactions totaling $9.6 million at 10,122 retailers. Manual card entries occur when an EBT card number is not swiped but instead manually entered into a point-of-sale terminal for a SNAP purchase. Such transactions could indicate instances of potential fraud whereby an individual has obtained the EBT card number and personal identification number of a recipient and is using this information to inappropriately obtain benefits. Although this monthly management report is available to DTA, it was not being used to monitor this activity during our audit period. [emphasis added]

$270M in multiple transactions by the same person within an hour.  $135M over six months.

Our analysis of monthly Multiple Transactions Within One Hour Reports for the six-month period May 1, 2012 through October 31, 2012 revealed that on average over 200,000 nonduplicative recipients processed 5,064,371 transactions totaling $135.8 million at an average of 11,800 retailers. These reports, which list multiple approved food stamp withdrawals made by the same card number within a one-hour timeframe, are designed to assist management in identifying possible card theft or misuse, such as EBT trafficking. Although this management report is available to DTA, it was not being used to monitor this activity during our audit period. [emphasis added]

During the budget debate of April 23, 2013, Democrats, one after another, got up and said with a straight face that reform was overkill as there is only a small percentage of abuse and fraud.  The Auditor uncovered that over 1/3 of all money spent should have been investigated for fraud, and that none of it was.  

Shaunna O’Connell deserves credit for keeping this on the front burner, and she is being vindicated with each passing day.

 

About Rob "EaBo Clipper" Eno

  • higher than that.

    The entire system is filled with fraud….and once in a great while SOMEone gets busted so the State can show how hard on fraud they are.

    I have a family member that was doing what everyone else was doing…collecting welfare benefits and making some under the table $$ at the same time. One of her “friends” (no longer) who was doing the same thing, had a fight with her and dropped a dime and my family member got hammered for it…….and rightly so.

    I don’t blame her for trying to make some $$ on the side to benefit her child, but she broke the rules and was punished accordingly. If only the other 99.99% of fraud were punished equally so.

    Had my family member been selling her benefits fraudulently, she’d still be doing it 20 years later.

    The system is rotten to the core…..just the way the modern day slave masters want it.

  • since I have a family member wh was in the system….most of her friends were in the system……and the ALL smoked 1+ packs of cigarettes a day and drank like fishes.

    Anecdotes….mere anecdotes….