Wisconsin Center for Investigative Journalism

State Crackdown on Food Stamp Fraud

12-fold increase in recipients suspended under Walker. Critics assail it as politically motivated.

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Hal Menendez, an attorney with Legal Action of Wisconsin’s Madison office, said most of the alleged fraud he sees amounts to mistakes on the part of those receiving assistance. “Sometimes people forget to report a change in their income or are late in reporting,” he said. In the past this might be cured simply by having the person pay back any overpayment.

“Now, oftentimes overpayments are being looked at as fraud or an intentional program violation,” Menendez said. That makes the recipient subject to benefit suspension: one year for a first violation, two years for a second and permanently for a third.

Hal Menendez, of Legal Action in Wisconsin, says overpayments to FoodShare recipients once treated as error are now often “being looked at as fraud or an intentional program violation.” Photo from Isthmus Publishing Co.

Hal Menendez, of Legal Action in Wisconsin, says overpayments to FoodShare recipients once treated as error are now often “being looked at as fraud or an intentional program violation.” Photo from Isthmus Publishing Co.

FoodShare recipients have a right to a hearing before an administrative law judge. But Menendez said many recipients are confused into signing forms sent by the state asking them to waive their right to a hearing. DHS numbers for a recent nearly 10-month period show that nearly a third of the people it sought to disqualify signed the waiver.

DeLessio, also of Legal Action, said she is representing a client with intellectual disabilities who signed the waiver terminating her benefits even though she cannot read. The woman is now without benefits.

Advocates for FoodShare recipients say when recipients contest a disqualification they often win. “The deciding factor may be whether the person appeared to explain the purchases,” DeLessio said.

If the recipient does not sign a waiver, a hearing is held. During the recent period under review, 348 hearings were held, and 311 disqualifications imposed. “We were upheld in 89 percent of the cases,” said White. This includes cases that are not contested, but White said the state still must present evidence.

Records of suspension cases provided by DeLessio show that some FoodShare recipients are targeted because they fall into a category of potential suspicion — for instance, by making unusually large or frequent purchases at a given store or having purchases that end in round numbers, like $20.00.

“We have seen people disqualified for less than $100,” DeLessio said.

White confirmed that his office looks for certain patterns, like large purchases, as “flags” of potential FoodShare fraud. And he acknowledged that “there are improvements that can be made” to the waiver form. He said that process is now under way.

According to White, the administrative law judges have “raised the bar” in terms of what evidence is required to disqualify recipients, “as is appropriate.” DeLessio still sees inconsistencies in how the cases are decided.

“The same evidence can lead to very different results depending on the judge,” DeLessio said.

‘It was very unfair’

In one case that came to hearing in 2013, a judge sustained a fraud finding against an individual who made five purchases over a three-month period from a store that was later disqualified from being a state FoodShare vendor. The purchases totaled $183.54; the store, the judge noted, was “not particularly close to respondent’s residence.” The respondent, who did not attend the hearing, was booted from the program for a year.

After another hearing, in 2014, a different judge rejected DHS’s attempt to disqualify a man for making numerous small purchases from a store that aroused suspicion in part because its owner admitted to allowing FoodShare recipients to use their cards to buy diapers, not an allowable purchase. The man appeared at the hearing and explained that the store was near where his children and their mother lived.

DeLessio represented Walter Triplett, 57, of Milwaukee, who in February 2014 was suspended from the FoodShare program for a year despite having appeared at a hearing to explain purchases that the DHS reviewer found suspicious. She filed a 25-page legal brief challenging this decision, which the state then agreed to vacate. But Triplett, who is disabled, was without FoodShare benefits for several months.

“It was very unfair,” Triplett said of the grounds for his disqualification. He got by by going to church food pantries. Also, “my family members helped me out as much as they could.”

DHS’s budget request for 2015-17 calls for the agency to “expand and improve” its fraud-fighting efforts. It sets a goal of 7,000 fraud investigations for each of the next three years.

Bill Lueders is the Money and Politics Project director at the Wisconsin Center for Investigative Journalism (www.WisconsinWatch.org). The Center produces the project in partnership with MapLight. The Center collaborates with Wisconsin Public Radio, Wisconsin Public Television, other news media and the UW-Madison School of Journalism and Mass Communication. All works created, published, posted or disseminated by the Center do not necessarily reflect the views or opinions of UW-Madison or any of its affiliates.

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49 thoughts on “State Crackdown on Food Stamp Fraud”

  1. PMD says:

    As far as requiring 2/3 of all food items to be healthy, the evidence that this is a problem is flimsy. One Rep from Saukville said he’s heard that many people are buying lobster with food stamps. I call BS. I also wonder if these legislators are aware of the neighborhoods many food stamp recipients live in and the lack of of businesses selling fruit and vegetables and the healthy food items they have in mind. This sure seems like the type of government overreach the GOP typically decries and a solution in search of a a problem.

  2. AG says:

    Anyone who actually knows the system knows that the biggest areas of fraud are from people selling their cards for .50 cents on the dollar and people who report false income levels. If we just start putting pictures on the cards and do a better job of verifying income we’d hit the vast majority of the fraud and we can worry less about punishing someone who is innocent of wrong doing.

  3. AG says:

    PMD, if the system works for the WIC program why is it such a bad idea for the foodshare program? We only care about the children’s health and not adults?

  4. PMD says:

    Yes that’s exactly what I said AG. Verbatim. We don’t care about the health of adults. You got it.

  5. AG says:

    Yeah, I took that trick right out of the PMD play book. 🙂

  6. PMD says:

    Do I always put words in your mouth AG? If so I’ll have to work on that.

  7. AG says:

    Yeah, it happens quite a bit with your leading questions. I got rather excited to turn the tables today.

  8. PMD says:

    Wow you must lead one boring life if that’s all it takes to excite you.

  9. Tweed says:

    I love this subject since this is my bread and butter.
    While the representative’s statement “keep an eye on people they see using FoodShare at the grocery store, saying “some people are arranging their life to be on FoodShare,” is sickening fraud is very real thing in the program.
    What the article fails to mention is that rather than the allegation of fraud (showing intent) there is also another outcome listed as “abuse”. If these were just mistakes dealing with the paperwork or properly reporting eligibility the case would designated as abuse rather than fraud. The criteria to label an allegation as fraud is quite high so one really has to be bold and get caught almost red handed. Social media plays an important role because some people are bold enough to advertise their cards for sale on there or other avenues of unreported income.

  10. PMD says:

    I’ve heard of people selling their cards on the web. I don’t doubt that is an issue. I don’t believe, and please correct me if I’m wrong, that a plethora of food stamp recipients are purchasing lobsters. I also think the food desert issue is real.

  11. Tweed says:

    The food desert theory has been debunked especially in MKE…maybe food swamp but not desert.
    Personally…who cares if they buy lobster??? It’s food and if they choose to purchase expensive items that deplete their funds sooner that’s their choice. That complaint is coming from the same party that bemoans big goverment in private citizens lives.

    What I think really gets at the goad (and rightfully so) of right leaning people are the people who tend to lean left defend fraudsters and saying that DHS is just be a big old meaning by picking on them. You would think that these folks would be out in front wanting to stop the fraud waste and abuse of this precious benefit.

  12. PMD says:

    It seems that many in the state legislature care about lobster purchases. What’s the difference between a food swamp and a food desert exactly? And who is defending people committing fraud? Do you have specific examples?

  13. Tweed says:

    From the article “But advocates for FoodShare recipients say the state is being overly aggressive, punishing needy people who make innocent mistakes.”

    Desert vs Swamp: http://voices.washingtonpost.com/all-we-can-eat/food-politics/food-deserts-vs-swamps-the-usd.html

  14. PMD says:

    I don’t think that quote should be read as defending people who knowingly commit fraud. That’s a reach.

    If there is no silver bullet, is the Legislature’s proposal to require recipients to spend two-thirds of their benefits on healthy food the best way to go?

  15. Tweed says:

    Well that’s your opinion and that’s my opinion but rather than talk about differences lets discuss solutions.

    AG’s idea about including a photo ID on the card isn’t bad but how about treat the use of the food share card like other financial transactions. Train and require that every purchase made with the card a photo ID has to be presented. I can see opponents lumping that in with the voter ID laws but it’s a start since you needed a photo ID to initially enroll in the program.
    I used to really get behind the idea of requiring people to purchase “healthy” foods but there is a very high systems cost. Every single provider accepting Food Share cards would have to upgrade their inventory systems to determine what is marked as healthy and what is not in order to submit that to the department.
    One thing I do like that I’ve seen is purchasing tokens at some of the Farmer’s markets around town. I don’t remember if they do this but I think it would be great if using your Food Share card it could give you double the purchasing power via the tokens. $10 charge to the card gives you $20 in tokens.

  16. PMD says:

    That sounds like a similar idea to the one mentioned in the article you linked to, which gave people in New York $2 for every $5 they spend at a farmer’s market. Something like that seems more practical than mandating the purchase of healthy foods.

  17. Tweed says:

    Something similar is done in Oakland too.
    If we did this in Wisconsin could it be construed as favoring one type of vendor over another though? Or favoring those in urban areas over participants in rural areas? What would keep vendors from places like 7 mile fair from accepting tokens for merchandise?
    Just trying to be devil’s advocate and bring things to their logical conclusion.

  18. Urban Dweller says:

    State government was created, and office-holders are elected, to serve the citizens of Wisconsin – and that means ALL of the citizens, not just the tea-party bigots and skinflints who voted for our corrupt Governor. These people are derelict in their duty.

  19. PMD says:

    Tweed I think you’ve already put more thought into it than our state legislators have. They seem fixated on people buying shellfish with food stamps (true or not) as opposed to generating workable ideas that would save money and improve health.

  20. Tim says:

    Tweed, there are farmers’ markets in rural areas too! Also, I’m guessing the answer to unscrupulous vendors accepting tokens for merchandise instead of food, would be the same thing that keeps stores only accepting specially designated WIC products & not whatever is available.

    Enforcement. No enforcement, we’ll get more stores abetting fraud.

  21. Ron says:

    How much does it cost tax payers for salary and all department costs to go after food stamp fraud? What is our return on investment to clean up the misrepresentation of nonqualified recipients? Is the saving monetarily justifiable?

  22. Big Al says:

    People buying shellfish with foodstamps – here’s the story that’s got the GOP’s undies in a bundle: http://www.foodstamps.org/articles/article/2014/02/25/surfer-dude-resurfaces-to-give-update-on-his-food-stamps-use

    I don’t think anyone is going to defend this guy, but to spend as much time as the Legislature is on this issue must mean that the budget is balanced, everyone has a job, and soon all of us will be living in a utopian society.

    Every program has fraud (check out WEDC!). Enforcement needs to balance stopping fraud with making sure honest people aren’t overly burdened. The problem with the current Administration is that poor people are pilloried as dishonest, while other groups are portrayed as making honest mistakes.

  23. PMD says:

    Yeah didn’t Fox News devote hours and hours of programming to one idiot who bought lobster with food stamps? He doesn’t live in Wisconsin though, and I’ve yet to hear about people here using food stamps to buy shellfish. Speaking of WEDC, we should drug test every employee of every company to receive any money from them.

  24. Tweed says:

    My wife(hard working single mother) was on food share before we were married and regularly bought shrimp with her food share. There….let some idiot wanna be neo con run us up the flag pole now because she bought shell fish…..

    It’s hard to measure the ROI on the admin cost of a “fraud department” (really Program Integrity) because you can only reliably track what has already been obtained by fraudulent means but not what could also continued to be gained or also the mitigation effect that such a program offers.

  25. AG says:

    OK, the shellfish thing is kind of a sideshow… if anything, it is pointing to the fact that this program is supposed to be a lifeline for those who really need help to literally survive. From my own experiences, which is of course a non scientific sampling, a good number of people who receive foodshare benefits don’t view it as spending other people’s money. This is money given by those who have to those who have not, in order for those without substantial means to get the nutrition they need so they don’t starve. If someone is purchasing candy, deserts, or any luxury food item, are they getting more benefits than they need?

    The far bigger problem stems from people selling their benefits. When I worked a second job in a retail setting, I had quite a few coworkers who readily admitted to selling their benefits and offered to do so to me regularly. This wasn’t the majority, but there were a good number of people.

    As with any program, maintaining the programs integrity is important to keeping it functioning properly and helping those who truly need it.

  26. PMD says:

    Is it even possible to afford luxury food items on a food stamp budget? And how do we define what the appropriate amount of candy and dessert is? I agree with your broader points AG, but do you have any hesitation about the government dictating how much or how little candy and dessert people can buy? I also wonder about the two-thirds requirement. That seems high. It’s not as if my family buys nothing but red meat and ice cream but there’s no way tho-thirds of our food purchases are healthy.

  27. AG says:

    PMD I think we’re pretty much on the same page, if only off in a few nuances of the situation. The presumption I was using was that if you’re using the foodshare to buy expensive steaks and lobster (metaphorically speaking) then you probably don’t need all the benefits you’re receiving.

    I don’t think the government should dictate what food people buy with their own money. But the responsible thing to do is make sure that when people spend money given to them by others that it’s done in a responsible way. There are families who do not qualify for foodshare yet struggle within their own budgets and thus can not afford “luxury” food. (Weird term, I know… )

    I still haven’t seen a good argument against running the foodshare program more like the WIC program.

  28. PMD says:

    How did the legislature come up with two-thirds? Is two-thirds the benchmark for the WIC program? Again that sounds high to me. Do vegetarians and vegans even spend two-thirds of their food budget on healthy items? And since healthier foods tend to be expensive, will the two-thirds requirement significantly reduce how much food they are able to buy with their benefits?

  29. PMD says:

    Wow the average American spends less than 5% of their food budget on fruits and green vegetables.


  30. Milwaukeean says:

    I will always understand the need for social services for certain populations of our community. But, why should those social services (like Food Share) fall on the backs of tax payers? To some level, shouldn’t the non-tax paying non-profits, churches, etc…carry most of these costs?

    Where is the “help thy neighbor” preaching, church-going, feed the poor folks at in Milwaukee? It seems a bit ironic that the same folks who love their church and God, are the same folks who do not want their own tax dollars to help “thy neighbor”.

  31. PMD says:

    Do churches and nonprofits have the finances or resources to carry most of the costs?

  32. Big Al says:

    The churches that have the most resources to assist would be the megachurches like Elmbrook. However, the majority of churches don’t look anything like Elmbrook; most of the older, smaller churches don’t have the resources to provide the kind of assistance that would be needed if the government ended its involvement. Based on my experience at 3 different churches in 3 different cities, after we paid for the pastor, secretary, janitor, utilities and mortgage, there was very little left to do much else.

    I think there are lots of “help thy neighbor” folks in town; I think there’s more need out there than those people can help on their own.

  33. AG says:

    PMD, WIC doesn’t dictate how you spend your total food budget, it instead gives you specific amounts to which you can spend on various food categories as found here: https://www.dhs.wisconsin.gov/publications/p4/p44578.pdf

    I don’t even know that foodshare needs to be that specific… but they can certainly reign things in more than they do now.

  34. R says:

    Do all if you really think this is an issue?

    How does it effect you?

    Are all of you employed?

    Own a home?

    Have credit card debit?

    Do you have a “profile” of people that are in need?

    What do you think these people look like?

  35. T2 says:

    So…none of you are have ever been on food share?

    So…do you know anyone that is?

    What do you think someone should not buy lobster on food share?

    What food should they buy on food share?

    Do you really care?

    Do you donate to feed starving people in other countries?

    Do you have a “profile” of what a person looks like that has food share?

    Do you think they are clean? Have a car? Live in the in suburbs of the city?

  36. Ben says:

    This program is supposed to be about getting food to hungry kids, not a vehicle to compete in our present national “lets shame the unfortunate” contest. I remember my schoolmates taking food from the school’s garbage to bring home to their families in the late 80’s im sure its worse today.

    Race seems to be a motivating factor in the drive to “supervise” poor people. Here is an example of someone who could have used supervision. Careful readers will note a shift in language.


  37. PMD says:

    I’m sure that’s true AG, but two-thirds seems random and unrealistic. It makes me question the true motives of the legislators. It does seem more about shaming than helping people (a la Kansas).

  38. Milwaukeean says:

    My point about the Churches and non-profits was that they mostly do “outreach” in other countries (See Elmbrook ministries) instead of in their own communities. Besides, shouldn’t the tax-exempt Churches put most of their resources back into the community to which they are tax-exempt (and subsequently preach politics behind the pullpit)?

  39. AG says:

    Why does this have to be about shaming instead of actually wanting the program that’s designed to help people in need to help people in need?

    Let me take a turn at T2’s questions because they address many of the concerns here:

    So…none of you are have ever been on food share? Thankfully, no.

    So…do you know anyone that is? Many. Family, friends, and current and former coworkers.

    [Why] do you think someone should not buy lobster on food share? Because it’s expensive and you can get a lot more food for the cost of one lobster. but this hold true for many other foods that are high priced when you can get an alternative in greater qty for less.

    What food should they buy on food share? Food to help them sustain a healthy life.

    Do you really care? Yes, very much.

    Do you donate to feed starving people in other countries? No, but I regularly donate to and volunteer at 2 local food banks.

    Do you have a “profile” of what a person looks like that has food share? No, they can be in the city, burbs, or country. You’d be surprised.

    Do you think they are clean? Have a car? Live in the in suburbs of the city? See above.

    My position comes from the point of view that you should only seek assistance if you truly need it, use it on things you truly need, and spend it as responsibly as possible. This is what the most people on assistance do… but there’s still plenty who abuse it or take it for granted.

  40. PMD says:

    It doesn’t have to be about shaming people AG, but I’m not convinced that our current legislature is truly dedicated to helping people in the most sensible ways possible as opposed to shaming them. When they talk about hearing stories about people buying lobster as their evidence as to why the two-thirds requirement is a good idea, it makes me question their motives.

    Who decides exactly what food helps recipients sustain a healthy lifestyle, and how much of that food they should be required to buy? Is the legislature trying to work with experts on this, or are they just deciding for themselves based on their anecdotes? And is it reasonable to be concerned about the expense of healthier food items and whether or not recipients will not be able to afford as much food every month if two-thirds of their purchases have to be healthy items?

  41. AG says:

    Nutritionists? Michelle Obama? My mother?

    It’s probably easier to say what does NOT qualify… candy, chips, soda, etc.

    Frankly though, I’m more concerned with the fraud than the types of food their getting. Although I’d still rather see them buying frozen pizza’s and peanut butter than I would cheetos and mountain dew. But thats nothing I can quantify. I would like, and what this article focuses on, is making sure it’s going to and used by the people who really need the assistance.

  42. PMD says:

    Ha I’m sure your mom knows all about healthy eating. I agree that fraud is a bigger concern. Fraud is no good.

  43. AG says:

    She actually does. 🙂

  44. PMD says:

    I believe you. Most moms do. Mine has long lamented my eating habits.

  45. This crackdown has little to do with any fairness or saving $ for state, rather it’s designed to punish certain folks for not working. Although the guv, continues to drive good jobs from our once very proud state. Beating up on the most underprivileged and poor is pure hate. Included in this unfortunate group are disabled, mentally challenged and ex convicts. This program was designed to give these folks a hand up. Many are undereducated and can’t or don’t make home made meals. I would like to know the whole cost of this enforcement compared to the $ saved. The enforcement staff appears to be high paid “placeholders”. Is there any restriction on purchasing the highest costing red meat steaks. Not that I know of. Why selectively pick out shell fish?? Is this crackdown funded by the red meat industry?? Put some of food stamp budget into outreach and education programs that actually work. With this continual beating up of the poor, this effort is bound to backfire. Stomp these unfortunates further into the ground and crime rate is likely to go up. Not big time crime but much more petty stuff so people can eat and feed their families. Remove funding here and move it to law enforcement and incarceration initiatives. This is the new Wisconsin sponsored and led by the guv. Signed Respectfully, GDM.

  46. T2 says:

    FoodShare Wisconsin-Anyone can apply for food share. You maybe able to enroll if: your family income is a or below the monthly program income….
    1 person net $958. Max benefit $189.
    2 people net $1293 Max benefit $347
    3 people net $1628 Max benefit $497
    4 people net $1963 Max benefit $632
    5 people net $2298 Max benefit $750
    6 people net $2522 Max benefit $900
    7 people net $2968 Max benefit $995
    8 people net $3303 Max benefit $1137

    You are a Wisconsin resident and you are a US citizen or qualifying immigrant.


    Why did you think it is just for children? Underprivileged means what? Disabled, mentally challenged,. What is mentally challenged? Isn’t that under the umbrella of disabled? Undereducated? Really? Interesting….

    Someone has a profile of people that receive Foodshare….ANYONE CAN APPLY.
    Unfortunate situations happen to people. Hardship happens. And the compassion seems to be criticism and exploiting them and judging.
    Lobster….it was on sale…2 small lobster tails were $17.99 at Aldis.

    Food to help them sustain a healthy life? What does that mean? Do you sustain a healthy life with food?

    Do you really care? Yes, very much. What is it that you care very much about?

    Do you donate to feed starving people in other countries? No, but I regularly donate to and volunteer at 2 local food banks. What do you donate to and volunteer at 2 local food banks. Are food banks or food pantries?
    Does it make you feel good volunteer….
    Do think America should send food and money etc to other countries in need to help them out? We do. And if we have money and food etc for other countries….we should have money and food etc for US.

    Do you have a “profile” of what a person looks like that has food share? No, they can be in the city, burbs, or country. You’d be surprised.
    Um….”profile”….what a person looks like. You didn’t answer that.

    Do you think they are clean? Have a car? Live in the in suburbs of the city? See above.
    I think you may have a “profile” of a food share recipient…

    My position comes from the point of view that you should only seek assistance if you truly need it, use it on things you truly need, and spend it as responsibly as possible. This is what the most people on assistance do… but there’s still plenty who abuse it or take it for granted.

    Truly need….honestly need…you can’t need. Spend what? Assistance….yeah…we all need help now and then…but are judged…and put down…

    You don’t know till it happens to you…

    Fraud is everywhere…someone will always try to get over on someone or something….Sad….

    Thank you all for your comments….don’t beat us up….because tax dollars help people in need. Don’t worry, the Gov won’t take all your money to help people…Alan White, appointed in 2011 to a newly created position of inspector general within DHS…your money is paying for his position.

  47. AG says:

    T2, from your responses… it looks like the person in this conversation with a “profile” in their mind is you. You’re making an awful lot of assumptions.

  48. Tweed says:

    Actively mitagating and stopping fraud is not about punishing or shaming anyone….trust me. This is really best practice and is good overall for the program.
    Food Share and other DHS entitlement programs are great but there needs to be quality controls and this is one of them.

  49. MH says:

    We were on benefits Feb 2012 because I lost my job to a person who wouldn’t doing her work call the race card. Got a job in April 2012. The county says they requested verification 5/2012 and received notification from my employer but mysteriously no income was reported. This is a lie, because I was copied on the form that was sent out to the county. Lets say for giggles they didn’t get the verification, the county tells you if you don’t verify within x time benefits cease. Received overpayment notice 2/29/12 saying I have a client error overpayment of 12K between FS and BadgerCare. 1. Why wait so long to mention someting. 2. Collected documents from my employer and have proof that the county was made aware of my income in 11/2012, remember they said they received verification 5/2012 but my employer did put my income on it, even with verification they say benefits continued for FS and BC. The FS i knew, but they were reduced so I thought it was because of my income. BC they say continued, but we had no knowledge of this. According to Dane County they allowed benefits to just roll from 2/1/2012 through 12/2013. They system magically did not terminate any services. I wasn’t given any income verification in 2013..why because in May 2012 when they said I did not report income I received letters stating that my income was over and that I had to pay 660 premium and that benefits had ended for me and my spouse. I never paid the premium it was too much. So according to the letter failure to pay the premium means no BC. Yet they say they paid insurance for my kids for 24 months without us paying them a dime. Something isn’t right, and now I have to fight. I did what I was supposed to do, my employer did what they were supposed to do providing the verification. Dane County these systems programmatically stop programs if the required proof is not received. Unless someone on the inside purposely kept the benefits going. Not likely. Scott Walker is scamming bad. If they find a small loop hole they are slapping people with fraud. I did nothing wrong. I have proof they were aware of my income since 2012 and 2013. My employer has letter requests for verification of income. So if an agency has proof that “income is too high” why continue to charge medicaid for 2 years and then go after a mother of 5 who had a short period of unemployment and bounced back taking care of her own when there is a lot of proof that the county knew my income . BECAUSE THE FRAUD IS WITHIN DHS AND SCOTT WALKER IS BEHIND IT. We are in financial ruins if I can’t fight the county. All because people didn’t do their jobs when they had all the proof in their face.

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