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The state's welfare agency made millions of dollars in questionable payments to people who were dead or otherwise ineligible for benefits, and missed numerous opportunities to detect potential fraud, according to an audit (PDF) made public Tuesday.
The report has already contributed to attempts at reform within the Department of Transitional Assistance, state Auditor Suzanne Bump said. In March, the agency unveiled a plan for ending abuse and assuring that benefits are legitimately going to those eligible to receive them.
The 2.5-year audit found a total 1,164 people who continued to receive welfare benefits for periods of six months to up to 27 months after they died, totaling nearly $2.4 million in payments.
In most cases, electronic benefits transfer (EBT) cards belonging to dead persons were being used by unauthorized individuals to make store purchases or withdraw cash from an ATM, according to the report.
In some cases, the auditors found, benefits were paid to guardians who claimed dead people as dependents.
"This audit demonstrates that DTA can do more to ensure that only eligible people are receiving benefits and that those benefits are not being abused," Bump said in a statement.
The audit also faulted the agency for failing to verify self-reported Social Security numbers, resulting in more than $1 million in benefits paid to people who had two separate Social Security numbers, had numbers that were being used by more than one individual or had a temporary number that was invalid.
Five regional DTA offices could not provide documentation for what happened to 30,000 blank EBT cards, the auditors said, raising questions about security and whether employees may have inappropriately used the cards, which work much like debit cards to allow welfare benefits to make purchases. The audit did not identify any specific criminal activity.
Bump also said the agency missed opportunities to ferret out fraud and abuse using reporting generated internally by the very technology it uses to administer benefits.
These unused reports pointed to more than $15 million in suspicious EBT activity that should have been flagged and investigated, the auditor said. For example, the department failed to follow up on people who made excessive requests for replacement EBT cards, a likely indication of illegal trafficking of the cards. One individual had been issued as many as 127 replacement cards since 2006.
Other examples of fraudulent patterns that could have been detected included $1.5 million in even-dollar food purchases in amounts such as $100 or $250 — unusual because purchases of food rarely end in even-dollar amounts.
Many of the auditor's findings were shared in advance with welfare officials and mirror some of the findings in an earlier report by the state's inspector general.
"The audit report's recommendations align with DTA's recently released 100-Day Action Plan (PDF), which takes proactive steps to prevent fraud and abuse, block EBT card usage at prohibited establishments and increase monitoring of card usage," said Stacey Monahan, interim commissioner of the welfare agency.
Monahan also pointed to a recently announced program that allows for the sharing of data with local police departments about possible misuse of EBT cards by recipients and retailers.
This article was originally published on May 28, 2013.
This program aired on May 28, 2013. The audio for this program is not available.
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