Friday, June 24, 2011

The Food-Stamp Crime Wave

Lax attitudes toward fraud are spurring swindles across the nation: • Earlier this month, the Milwaukee Journal Sentinel revealed that Wisconsin food-stamp recipients routinely sell their benefit cards on Facebook. The investigation also found that "nearly 2,000 recipients claimed they lost their card six or more times in 2010 and requested replacements." USDA rules require that lost cards be speedily replaced. The Wisconsin Policy Research Institute concluded: "Prosecutors have simply stopped prosecuting the vast majority of [food-stamp] fraud cases in virtually all counties, including the one with the most recipients, Milwaukee." • Troy Hutson, the chief of Washington state's food-stamp program, resigned in April after a Seattle television station revealed that some food-stamp recipients were selling their cards on Craigslist or brazenly cashing them out on street corners (for 50 cents on the dollar) and using the proceeds for illegal drugs and prostitution. Washington state Sen. Mike Carrell complained: "Dozens of workers at DSHS [the Department of Social and Health Services] have reported numerous unpunished cases of fraud to me. They have told me that DSHS management has allowed these things to happen, and in some cases actively restricted fraud investigations." • Thirty percent of the inmates in the Polk County, Iowa, jail were collecting food stamps that were being sent to their non-jail mailing addresses in 2009. But Iowa could not prosecute them for fraud because the state's food-stamp form failed to ask applicants whether they were heading for the slammer. Roger Munns, a spokesman for the Iowa Department of Human Services, told the Des Moines Register last year that asking such questions could make food-stamp applications "unwieldy." (Many states do make such inquiries.) Looser federal rules are spurring a bureaucratic crime wave. Last December, two veteran employees for New York City's Human Resources Administration were busted for concocting 1,500 fake food-stamp cases that netted them $8 million. Nine Milwaukee, Wis., staffers plundered almost $300,000 from the program during the last five years, and a Louisiana state bureaucrat pleaded guilty last year for her role in a scam that snared more than $50,000 in fraudulent food-stamp benefits. The Obama administration is responding by cracking down on state governments' antifraud measures. The administration is seeking to compel California, New York and Texas to cease requiring food-stamp applicants to provide finger images...more

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