WASHINGTON, DC – Senator Dan Coats (R-Ind.), the Chairman of the Joint Economic Committee, today delivered his weekly “Waste of the Week” speech and highlighted documented abuse of the Department of Agriculture’s Supplemental Nutrition Assistance Program (SNAP).
SNAP is a federal program that helps low-income families purchase food items. The federal government allocates money to beneficiaries on an “electronic benefits transfer card” (EBT card) that works like a debit card. These government-issued EBT cards are accepted at most grocery stores.
Coats said that a major vulnerability within SNAP is frequent requests for EBT card replacements. While some families simply lose the card and need a replacement, many individuals are placing multiple requests a year for new cards.
The non-partisan Government Accountability Office (GAO) investigated this issue and examined both the timing of requests – such as when SNAP funds had been replenished – and the amount of replacement cards households requested. The GAO looked at just three states – Massachusetts, Michigan and Nebraska – and found that more than 7,500 households receiving SNAP benefits had suspicious transactions and were issued four or more EBT cards in a year during key times, such as when cards were credited with benefits. These 7,500 households accounted for more than $26 million in suspicious transactions.
“Now these were not large-population states like California, Florida, New York or Texas. So imagine how large the potential fraud is if you factor in all 50 states,” said Coats. “Calculating the same proportion of SNAP households as the 7,500 identified by GAO across the country, the potential fraud amounts to roughly $3.2 billion in waste over 10 years.”
Coats cited clear cases of EBT fraud found on Craigslist, including the resale of an EBT card with $1,300 in benefits for $300 in which the seller stated, “I have around 1,300 in food stamps and have no need for it all.” Coats discussed another Craiglist example in which an individual stated that he or she would accept EBT cards as payments for Beyoncé concert tickets.
“This kind of fraud is shameful,” said Coats. “This assistance should only go to those who absolutely need it, for its intended purpose. States are already required to track households that request four or more replacement EBT cards within a year. But if they adopt GAO’s methodology of tracking both the number of recipients that receive four or more EBT cards at specific times of the year and those with suspicious transactions, much of this abuse could be eliminated.”
To watch this week’s installment of Waste of the Week, click here.