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Friday, May 6, 2016

One more go at assistance fraud

Saturday, January 19, 2013

Not that I'm particularly interested in revisiting the whole SNAP card and government subsidized program abuses, which have been discussed in this column and through online comment, but I did want to share something I received.

The following information certainly doesn't confirm anything regarding government food programs and those allegedly using small green and purple fruit to scam the system, but it does suggest it is possible to abuse government benefits. None of the instances cited point to grapes for cash exchanges as suggested by my friend in Austin (as previously shared in this column), but there is obviously some misuse of the system.

From Agri-Pulse:

WASHINGTON, Jan. 16, 2013 - The Agriculture Department's Office of the Inspector General (OIG) announced today several enforcement actions involving fraudulent use of Supplemental Nutrition Assistance Program (SNAP) benefits.

In one case, a Minnesota store owner was sentenced in federal court Nov. 29 to 41 months in a high-security prison and fined $2.4 million for SNAP fraud. He was ordered to surrender in June 2012, but fled to Belize. The man was tracked down by the U.S. Marshals Service and the USDA's OIG, and returned to the United States.


OIG's investigation had found that the owner was trafficking SNAP benefits and Women, Infants and Children Program (WIC) benefits, committing fraud in excess of $3 million.

In another case, an employee of a Detroit convenience store, after pleading guilty, was sentenced to 48 months of probation and fined $60,000 for his role in a criminal enterprise involving SNAP benefits.

OIG said its investigation found that the employee illegally exchanged SNAP benefits for ineligible items on a number of occasions. The investigation found that the store's SNAP redemptions far exceeded those of comparable stores in the area.

In other cases:

- An Indiana store manager was sentenced Dec. 17 to 41 months in prison and fined $1.4 million for his role in a SNAP benefits trafficking ring. OIG agents said the man and his two sons had exchanged SPAN benefits for cash. The agents said they seized more than $500,000 in cash and an unknown amount of jewelry. The sons pled guilty to wire fraud and were sentenced to 12 months of probation in September.

- An employee of a small convenience store in Michigan was sentenced Dec. 18 to 18 months in prison and fined $613,000 for conspiracy to commit SNAP fraud. In addition, he was sentenced to 60 months in prison, to be served concurrently, on a firearms charge. OIG said its investigation found that the employee had a network of individuals who obtained SNAP electronic benefit transfer cards from recipients, and then made phone calls to the store where manual transactions were conducted.

- A Portland woman was sentenced Dec. 19 to 63 months in prison and fined $5,000 for fraudulently receiving SNAP benefits. In addition, she was sentenced to 63 months in prison, to be served concurrently, for heroin distribution.

- The owner of a Chicago fish market was sentenced Nov. 26 to 33 months in prison and fined $674,886 for trafficking SNAP benefits. The man pled guilty to two counts of wire fraud in August 2012.

- The owner of a Pennsylvania food store was sentenced Nov. 29 to 21 months in prison and fined $225,000 for trafficking SNAP benefits. OIG said the store owner exchanged SNAP benefits for cash on multiple occasions. She was charged and pled guilty in May 2012 to one count of SNAP fraud.

Fortunately the people mentioned in this article have been caught and prosecuted, but you can only imagine how many other system abuses go unchecked. And such was the point of my original columns. There are people out there taking advantage of a system, and stealing from those who fund the system - not the U.S. Government - but the taxpayers who are asked to not only take care of their own families, but to foot the bill for those who need assistance.

I don't mind helping those in true need as they work to get back on their feet, but I've got a real problem giving to a system that allows people to turn a helping hand into a way of life. And if you don't believe there are people out there living off the system, you need to wake up and take a hard look around.

- To respond to Randy Cauthron, email him at news@spencerdailyreporter.com, contact him at 712-262-6610 or go online: www.spencerdailyreporter.com. Follow Randy on Twitter @RandyCauthron.

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Nobody said they didn't believe "there are people out there living off the system". What was called into question was your apparent unwillingness to fact-check a story before putting it into print and your wife's subsequent claim that fraud was so rampant that she herself had witnessed it of a friend (as well as her unwillingness to report such fraud). That said, it is my opinion that if SNAP were run similarly to WIC (which, admittedly, has also has had cases of fraud), more money would be spent on healthful foods that truly benefit those that consume them.

-- Posted by notinia on Sat, Jan 19, 2013, at 12:24 PM


I agree with your statement, "Nobody said they didn't believe "there are people out there living off the system." What was called into question was your apparent unwillingness to fact-check a story before putting it into print and your wife's subsequent claim that fraud was so rampant that she herself had witnessed it of a friend (as well as her unwillingness to report such fraud)."

This was my statement to Randy after he wrote his 'Trouble with the System' opinion: "I did not say that there was not fraud in the use of food stamp cards. I stated that the story about an individual purchasing two grapes and getting $100.00 back from the food stamp cards was not true."

I also stated the following: "Since Randy has the name of his friend who reported seeing an individual receive $100 back from two food stamp cards after purchasing two grapes, his friend has the name of the grocery store where he observed this, this can be investigated. Since Leah knows the name of her friend who received cash back from a food stamp card at HyVee last Thanksgiving, this can be investigated." http://www.fns.usda.gov/cga/pressrelease...

-- Posted by Judith Olson on Sun, Jan 20, 2013, at 6:53 AM

Hey Randy, why would you want to go there again? Why do you care so much whether poor people trade their govt. benes for cash? Why not take on the big time politicians and big business gangsters that hide behind God and Country and rob us all of billions and leave us in bondage? The poor mother that trades her milk benefit for a six pack needs help rather than jail. Expand your vision Randy!!!!!!!

-- Posted by Cookster on Sun, Jan 20, 2013, at 7:49 AM

On-topic? Somewhat... how does everyone feel about WIC?

-- Posted by notinia on Sun, Jan 20, 2013, at 10:04 AM

Yes, we need to continually educate individuals to have integrity and to take responsibility for their actions.

This is what we hope for and strive for in our country:

"I have the audacity to believe that people everywhere can have three meals a day for their bodies, education and culture for the minds and dignity, equality and freedom for their spirits." --Martin Luther King Jr.

-- Posted by Judith Olson on Mon, Jan 21, 2013, at 8:02 AM

Cookster: Yes, I agree with your statement: "Expand your vision, Randy!"

-- Posted by Judith Olson on Mon, Jan 21, 2013, at 8:03 AM

Here are specific resources from Naomi Sea Young Wittstruck, who is the Leadership Development Minister for Social Justice & Mission, Iowa Annual Conference of the United Methodist Church.

There are a variety of resources on SNAP (formerly known as food stamps) and specifics to Iowa. The first article listed below really hits at the facts of Iowa SNAP.

Here is an excellent article citing the specifics and actual data for Iowa SNAP (formerly known as food stamps), including a statement from the head of the Iowa Department of Human Services (DHS). http://wcfcourier.com/hunger/articles/pr...

Here is the United Methodist Church Book of Resolutions: 2008-2012 - Resolution #4091. Principles of Welfare Reform, that address our biblical and denominational stances on poverty and food stamps.

Here is an article from some of the Iowa Human Needs Advocates Coalition. The article was written by Jennifer Jacobs in response to the Editorial Board meeting by some of our leaders for the coalition: http://blogs.desmoinesregister.com/dmr/i....

Bread for the World Resources:

Here is a link to several policy research papers: http://www.bread.org/what-we-do/resource...

Here is a link to specific hunger and food security facts: http://www.bread.org/hunger/us/

Here is another link to areas of hunger statistics in the United States and the SNAP (Supplemental Nutrition Assistance Program) information: http://www.bread.org/hunger/us/facts.htm...

FRAC: Food Research Action Center


Here is the specific webpage on their website dedicated to statistical information and facts on SNAP (food stamps) http://frac.org/federal-foodnutrition-pr...

Here are some additional resources for Iowa-specific details:

RESULTS: http://www.results.org/issues/us_poverty...

Iowa Policy Project: http://www.iowapolicyproject.org/2011Res...

-- Posted by Judith Olson on Mon, Jan 21, 2013, at 8:17 AM

Iowa Policy Project: The link was incorrect in my previous message. Try this link:


-- Posted by Judith Olson on Mon, Jan 21, 2013, at 8:23 AM

Some of you people forget where the so called "gov't benes" and entitlements come from...us, We The People pay for them through taxes. And since the gov't has spent more than it takes in, this is one of the many reasons we're over $16T in debt.

-- Posted by Dennis the Menace on Mon, Jan 21, 2013, at 10:54 AM

So what's your point, Randy? There's fraud in every organization and program, public and private, from religion to the military to Wall St. Yet you and others seem to ONLY focus on fraud found in programs for those in need. What did the least among us ever do to you? There are rules and they are being enforced as per your examples. Just WHAT do you want?

"I'm shocked, shocked to find that fraud is going on in here."

As far as "living off the system", aren't we all? We live in freedom and safety with access to education and healthcare, safety nets in times if need, the infrastructure to move about the country to live and work, etc. All thanks to "the system". The system of a govt of, by and FOR the people.

There are those that still hate seeing someone getting something they didn't instead of being thankful the modest safety net is there for them in times of need and mostly, that they don't need it.

-- Posted by helped_myself on Mon, Jan 21, 2013, at 11:59 AM

Do you realize the largest Medicare fraud in the country's history was by a Corp headed up a man whose only consequence was to end up with $360 million, enough to be able to buy the Florida governorship for $75 million. Then he promptly started cutting Medicare/Medicaid to the poor in Florida while funneling state $ to his wife's business.

In late 2002, HCA agreed to pay the U.S. government $631 million, plus interest, and pay $17.5 million to state Medicaid agencies, in addition to $250 million paid up to that point to resolve outstanding Medicare expense claims. In all, civil law suits cost HCA more than $2 billion to settle, by far the largest fraud settlement in US history.

Just how many grapes would that money buy? Yet you focus on a $100 that someone has to buy food for a month. If welfare is such an easy and comfortable lifestyle, why not try it? You'd be singing a different tune then.

-- Posted by helped_myself on Mon, Jan 21, 2013, at 12:15 PM

Geez...what is the point of rehashing this again? The same points will be made over and over by the same people as the last editorial on this topic. I think somebody likes the attention a little too much and is trying a little too hard to make a point that has already been made.

-- Posted by EmilyB on Mon, Jan 21, 2013, at 6:35 PM

EmilyB, I realize I'm just as bad by commenting here, but you're absolutely right. Prefacing a column with "not that I want to revisit this topic again, but [insert opinion about said topic}" is like saying "no offense but [insert insult]". You can say all you want that you're not talking about something or that you don't particularly want to talk about something... but bringing it up anyway pretty much negates that ;)

-- Posted by notinia on Mon, Jan 21, 2013, at 9:56 PM

lol.....Randy I have to say you have some b***** to keep bringing this up....lol


-- Posted by acerdj on Tue, Jan 22, 2013, at 8:37 AM

helped_myself- Lets see if I understand this correctly. A large company (along with thousands of others) was busted for improper medicare billing and forced to pay large fines. And some how this make it ok for welfare recipients to defraud with no consequences?

-- Posted by deweyh on Tue, Jan 22, 2013, at 6:29 PM

This subject, along with many others, is way too over analyzed. As long as good people are helping good people, there will always be parasites globbing on to the benefits. Most just need a boost, but some will take advantage. Its the bureaucracy flooded system that opens the door for this crap.

-- Posted by brian48 on Wed, Jan 23, 2013, at 2:50 AM

I applaud Randy for bringing up the issue. SNAP is a safety net. One that won't be available in the future if we do not curtail government spending. By detecting and prosecuting fraud we can stop waste. We are also stopping those who prey on low income people.

Some of the above comments sound as if it's okay to commit fraud. It's okay to steal from the government, aka We The People? No it's not! These programs are to help our people in times of need, not for a few to get rich off of through fraud.

-- Posted by frmriowan on Sat, Jan 26, 2013, at 1:17 AM

It's either feed the masses or they'll be breaking into your homes and businesses. People will eat, one way or another.

-- Posted by Doctlby on Sat, Jan 26, 2013, at 6:57 PM

Yep, fmriowan. We're saying its OK to commit fraud. We're also saying reading comprehension isn't important.

-- Posted by notinia on Sun, Jan 27, 2013, at 6:50 PM

No one said fraud is ok. It should and is being addressed. My point is critics here focus on the $100 a month going to people in need because they didn't suffer enough yet in their opinion as opposed to the multi million $ being legitimately and illegitimately taken by corps with record profits.

So when you cut your lawn do you only focus on one long blade of grass and ignore the rest of it also?

-- Posted by helped_myself on Wed, Feb 20, 2013, at 9:55 AM

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Randy Cauthron
One Man's Perspective