State Crackdown on Food Stamp Fraud
12-fold increase in recipients suspended under Walker. Critics assail it as politically motivated.
Are rights being protected?
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.
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.
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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