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Calif. officials running out of time for welfare fraud plan

- The Washington Times - Monday, June 28, 2010

California human services officials have just a few more days to come up with a plan to combat welfare fraud, waste and abuse, including blocking welfare recipients from cashing their state-issued benefits in casinos and poker rooms.

California Gov. Arnold Schwarzenegger issued an executive order at the end of last week, telling the state Department of Social Services (DSS) to "immediately take all necessary steps" to ensure that CalWORKS recipients not get their welfare benefits "from ATMs in gambling establishments."

Mr. Schwarzenegger further ordered DSS to devise an action plan within seven days to reduce waste, fraud and abuse. This means a response is due no later than July 6.

Some 32 of 58 tribal casinos and 47 of 90 state-licensed poker rooms let welfare recipients use their benefits-debit cards to get cash. The cash welfare grant for a family of three is $694. The governor's order came after a Los Angeles Times report documented that welfare benefits averaging about $227,000 a month, or about $1.8 million per year, were listed as "casino withdrawals."

California's fiscal house is in chaos, with a $19 billion deficit, and lawmakers are struggling to make deep cuts in spending.

While paper welfare checks were used for decades, virtually all states have now switched to Electronic Benefits Transfer (EBT) debit cards to deliver many kinds of welfare benefits, including cash; food; energy assistance; child care subsidies and payments for the care of foster youth.

The state of New Mexico and Global Cash Access, a Las Vegas firm that provides ATMs for more than 1,000 casinos, have already taken steps to make sure casino ATMs reject welfare cards, the Los Angeles Times reported.

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