Food Stamp Fraud Becoming Hi Tech

By: CNN (posted by Justin Surrency) Email
By: CNN (posted by Justin Surrency) Email

CNN- The U.S. Department of Agriculture announced Thursday new proposals targeting individuals who sell SNAP cards, commonly known as food stamps, for cash.

The agency said individuals suspected of defrauding the system are requesting a large number of replacement cards.

Food stamp fraud has gone high-tech in recent years, with SNAP cards being sold on Craigslist and eBay, according to the USDA. There also have been attempts to sell the food assistance benefits through the popular social media sites Twitter and Facebook.

Replacement cards are issued to recipients on a case-by-case basis, but increased scrutiny is needed to root out the thieves, the USDA said.

"There are many legitimate reasons for replacing cards, and the vast majority of recipients follow the rules," said Kevin Concannon, agriculture undersecretary for food, nutrition and consumer services. "But we are concerned that a few bad actors are using replacement cards to exchange SNAP benefits for cash, (an activity) commonly referred to as trafficking."

The rules proposed Thursday will give states the option to place individuals under increased scrutiny when they have asked for an excessive number of replacement cards. Determination of when requests are excessive and require further investigation will be up to the states.

States will be required to protect elderly individuals and people with disabilities who may repeatedly lose their cards but are not committing fraud, the proposal noted.

According to the USDA, current laws don't permit states to contact households for information about requests for multiple replacements, which in some cases may indicate fraudulent activity.

Trafficking SNAP cards is illegal and punishable in several ways, including disqualification from the program, fines, and criminal prosecution, according to the USDA. Over the past 15 years, Agriculture Department officials said, they have aggressively put into place a number of measures to reduce fraud within the SNAP system.

But it's not just individuals who are gaming the system, the agency said. So far this year, the USDA has imposed sanctions, including fines or temporary disqualifications, on 198 stores found violating program rules. In addition, 366 stores have been permanently kicked out of the SNAP program for exchanging SNAP benefits for cash.

The USDA said it plans to announce additional sanctions and penalties being developed for fraudulent retailers, along with increased efforts to ensure those who are booted from the system in one state don't regain access by applying for SNAP benefits in another state.

The USDA said that last year investigators reviewed over 15,000 stores. More than 1,200 stores were permanently disqualified for trafficking and more than 600 were sanctioned for other violations, such as applying the benefits to purchases of ineligible items.

SNAP stands for Supplemental Nutrition Assistance Program. It began under the name "food stamps," using paper stamps or coupons. Debit-type cards were phased in beginning in the 1990s


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