State stumbles on anti-fraud efforts for food stamps, welfare-to-work

November 10th, 2009

Teri Sforza, Register staff writer

(Lots of graphs at the link which don't show here.)

If one wants to game the system, Los Angeles County may be the place to be. Potential cheats face a tougher time in Orange and San Diego counties - but California in general is in a bit of a dither when it comes to detecting fraud in its $6.4 billion welfare programs, according to the California State Auditor (welfare-fraud-full-report).

Some anti-fraud programs actually cost more than they save.

A STITCH IN TIME…

The good news: For every $1 spent on early fraud detection (i.e., nipping it in the bud as people apply) for welfare-to-work, California saves $1.35.

The bad news: For every $1 spent on early fraud detection for food stamps, California saves, um, 93 cents.

Whoops. These early detection programs cost the state $28 million.

…SAVES NINE

The picture is bleaker for late fraud detection (i.e., mounting investigations to see if aid recipients are cheating), where California spends more - $34 million - and gets less.

For every $1 spent on ongoing investigations on welfare-to-work fraud, the state saved 88 cents.

For every $1 spent investigating food stamp fraud, it saved 72 cents.

Gathering evidence for ongoing investigations costs lots, the auditor says.

FURTHERMORE….

•Counties sometimes fail to match their welfare rolls against regularly-updated lists of people who are ineligible for benefits.•Large backlogs of duplicate-aide fraud cases are languishing.
•Counties regularly forward erroneous data to the state, which forwards it to the federal government.
“This report concludes that neither Social Services nor the six counties we visited have performed any meaningful analysis to determine the cost-effectiveness of counties’ antifraud efforts,â€