Report cites uptick in welfare fraud | News
BOSTON — The state saw an uptick in welfare fraud last year from beneficiaries trying to use state-issued debit cards to buy pot and other banned items.
The Department of Transitional Assistance, which oversees Massachusetts’ welfare system, says it blocked at least 683 attempts to use electronic benefit transfer cards to purchase banned items such as cigarettes, alcohol and marijuana.
That’s a more than 40% increase over the previous year, when the state agency blocked at least 480 illegal EBT card transactions, according to a new report.
EBT cards work like debit cards, allowing recipients to withdraw cash at ATMs. Welfare recipients can’t buy alcohol, tobacco or other prohibited items with their cards, but they can take out cash from an ATM to buy whatever they want.
Attempted pot buys
As of the end of December, the agency has blocked nearly $29,000 in attempted withdrawals from ATMs at recreational pot shops, according to the report.
Because most marijuana shops are cash-only, many have on-site ATMs allowing customers to make withdrawals. DTA inspectors visit the shops to document ATMs, cash registers and other point-of-sale devices and monitor transactions to determine of anyone with an EBT card is trying to buy pot.
The agency didn’t disclose locations of the attempts, or whether there were any successful transactions in the previous year.
Overall, the agency said it has blocked the illegal use of benefits cards at more than 4,000 cash machines and point-of-sale systems since 2013.
The agency also reported 168 cases in 2021 where welfare benefits were denied because of intentional fraud, totaling more than $52,000. In another 630 cases, benefits were reduced because of “unintentional violations” by beneficiaries.
More than 2,000 welfare fraud cases were referred to the state Auditor Office’s Bureau of Special Investigations last year for additional review. The bureau has the power to investigate allegations of fraud in public assistance programs.
The penalty for welfare fraud is up to 10 years in prison, in addition to repayment of the money.
Demand for food stamps and other public assistance has risen amid the economic fallout of the COVID-19 pandemic. Despite that, the number of families on the state’s primary cash assistance program, known as Transitional Aid to Families with Dependent Children, has declined by half since the 1990s, to about 30,000 per month, according to state data.
The state spends about $16 million a month on the programs.
Under current law, a recipient is limited to receiving welfare for two years in any five-year period. A family of three in the program collects roughly $593 per month.
“Nearly all individuals receiving public assistance through DTA programs use benefits as intended — to meet their family’s basic needs,” the DTA report said.
Advocates for the benefits programs say the money the state uses to root out fraud would be better spent expanding the programs for the neediest of families.
In 2012, lawmakers set harsher penalties for store owners who allow recipients to buy Lottery tickets, tobacco and other prohibited items with their benefits cards.
The law, signed by then-Gov. Deval Patrick, added televisions, stereos and video games to a list of items forbidden from being purchased with the benefits.
Also, as part of the reforms, an “able-bodied” recipient must work 30 hours a week to continue receiving the benefits.
The changes were driven, in part, by a scathing 2013 state audit revealing millions of dollars in “questionable benefits,” in some cases paid to dead people.
Christian M. Wade covers the Massachusetts Statehouse for North of Boston Media Group’s newspapers and websites. Email him at email@example.com.