USDA audit identifies Kansas food stamp fraud
11/30/2011 5:00 AM
12/01/2011 6:59 AM
State auditors trying to weed out food-stamp fraud believe more than 7,000 people in Kansas may be getting benefits to which they aren't entitled and costing taxpayers as much as $22 million a year, the state's top social services official said Wednesday.
Rob Siedlecki, director of the Kansas Department of Social and Rehabilitation Services, blamed what he called lax enforcement under previous administrations that cut back on fraud investigators - an allegation quickly rejected by his predecessor, who said the department did what it could with limited resources.
Siedlecki said he understands many people need assistance and that it's his job to ensure qualified residents receive help. But he noted that every dollar wasted on fraud could have been given to someone who was eligible to receive it.
"We know people are hurting," he said. "But if you want to game the system, we're going to come after you."
A state review of welfare programs conducted in October found 312 possibly dead recipients, 941 cases in which there was severe risk of identity fraud, 261 recipients believed to be incarcerated and 6,400 who had out-of-state driver's licenses.
That number was far higher than the results of a recent audit by the U.S. Department of Agriculture, which runs the Supplemental Nutrition Assistance Program, previously known as the Food Stamp Program.
The USDA audit found that 883 beneficiaries were improperly receiving assistance between August 2009 and August 2010. They included people who were dead, had invalid Social Security numbers or were double-dipping from the federal program.
The USDA audit didn't consider some factors included in the state's review, such as prison inmates who may still be collecting assistance or individuals who had non-Kansas driver's licenses. The latter accounted for the bulk of the state's possible fraud cases.
"This report confirms what we already knew: that benefits fraud and mistakes exist in the SNAP program," Siedlecki said.
One common way people are committing fraud is by selling their Vision cards, which are used in place of food stamps, for less than face value. That means program participants are getting cash while purchasers are getting benefits they don't deserve.
Siedlecki said the state is developing the automated Kansas Eligibility Enforcement System, a $140 million project aimed at improving the state's accuracy in determining eligibility for cash and food assistance, and medical benefits by cross-referencing state and federal data sources. He said the federal government is picking up the tab for most of the KEES system.
Siedlecki said that when he took over as SRS chief in January, there were only eight welfare fraud investigators statewide - including one investigator for all of the state's 47 western counties - and no anti-fraud director.
"They gutted the office in half, had no director and no investigator in the state's largest city, Wichita," Siedlecki said of previous administrations. "Finding fraud wasn't a priority."
The secretary called welfare fraud "low-hanging fruit" that is easily detectible through examining program data. He said the total of welfare fraud in Kansas could go as high as $30 million once investigators start digging deeper.
Don Jordan, who was SRS secretary under Democratic governors Kathleen Sebelius and Mark Parkinson, said those administrations did not take welfare fraud lightly.
"During the time I was secretary, there were very tight resources," Jordan said.
The department tried to ensure "eligible people got the amount of benefits they were eligible for. We didn't put a higher or lower priority on any part of that job, including detecting fraud. The main way you do that is by determining eligibility up front," he said.
Siedlecki said two weeks ago that his director of fraud investigation, Ken Thompson, was appointed by state Attorney General Derek Schmidt as a special assistant attorney general and would have prosecutorial authority. What that means, Siedlecki explained, is that his department could criminally prosecute people who commit welfare fraud in Kansas.
In the past, the most the state could do was pursue lawsuits. While civil judgments can be dismissed in bankruptcy court, he said, criminal restitution orders can't.
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