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Proposal targets eligibility, fraud in food stamp program
Stores found cheating could be both fined, disqualified
Question of the Day
A top Agriculture Department official Thursday announced an initiative to counter fraud in the $80 billion food stamp program, entering a campaign-tinged fray that has recently focused on abuse of entitlement programs for the poor.
The department is proposing increasing penalties for retailers and providing states with access to large federal databases they would be required to use to verify information from applicants.
Food-stamp fraud, generally in the form of store employees buying food stamps from recipients for cash at 50 cents on the dollar, is widespread in urban areas, with one in seven corner stores engaging in such behavior, according to a recent government estimate.
But Kevin Concannon, an Agriculture Department undersecretary, said that the department has been hamstrung in its effort to deter fraud by existing regulations that limit the sanctions it can impose. For example, if a retailer engages in behavior serious enough to warrant a ban from the program, the department is unable to impose monetary fines.
“Too often we believe penalties to retailers are viewed as a slap as a wrist and are not enough to deter behavior. We impose a fine, or a permanent removal, but we can’t do both. Under these new proposals, USDA would be able to fine and disqualify a store,” he said.
The changes must undergo the formal rule-making process before becoming final.
New policies would also make fines proportionate with the total amount of food-stamp dollars processed by a store, enabling the possibility of higher fines. “The penalty would more closely fit the crime,” Mr. Concannon said on a call with reporters.
What happens to food-stamp dollars is shrouded in secrecy, with a provision in the law seen as protecting retailers keeping the public in the dark about where the aid is spent, and even government officials have no idea what types of food the public money buys, The Washington Times reported in June.
And a complicated joint arrangement between the states and the federal government poses logistical questions when it comes to enforcement.
“The Food and Nutrition Service has ultimate responsibility. State governments have the responsibilities for imposing sanctions on individuals, while we track stores,” Mr. Concannon said.
That raises questions about how a Washington-based agency can monitor situations in corner stores across the country, including enforcing regulations that require stores to have a variety of healthy foods on their shelves.
“There are in excess of 200,000 stores, and we have 100 agents spread across the country. Some do undercover work, but the principal way we track fraud is through analyzing electronic transactions” for suspicious patterns, Mr. Concannon told The Times.
Meanwhile, states have the task of enforcing the law against recipients — even though it takes both a recipient and store to commit food stamp trafficking.
A Government Accountability Office audit last month found that a larger problem than trafficking is the admission of people into the program whose incomes don’t warrant it under the typical poverty threshold. That decision is made by the states, which in some cases deem a person eligible for the federally-funded program by the mere act of having been offered a welfare brochure—a broad interpretation of federal rules that allow those receiving welfare services to get automatic food stamp eligibility.
To enable states to vet applicants more thoroughly, the federal government is putting increased emphasis on using digital tools to automatically and regularly check application information against existing sources of government data. Those include death rolls, unemployment insurance and work records, and jail populations.
© Copyright 2014 The Washington Times, LLC. Click here for reprint permission.
About the Author
Luke Rosiak is a projects reporter on The Washington Times’ investigative team. He formerly covered lobbying and campaign finance for two watchdog groups as well as transportation for The Washington Post. Luke can be reached at email@example.com.
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