PA inspector general targets food stamp fraud

Offering cash for food stamps is a form of welfare fraud that takes food out of the mouths of children and robs taxpayers. And a state official wants those engaged in it to know he’s coming after them.

“It’s important for these store owners to know that the state Inspector General’s Office is prioritizing prosecutions of this type of trafficking,” Inspector General Bruce Beemer said, appearing at the Muhlenberg Township municipal building Thursday with state Sen. Judy Schwank, a Ruscombmanor Township Democrat.

“Unfortunately I’ve seen many reports of fraud happening here in Berks County,” Schwank said.

The crime is known as SNAP trafficking because it involves the sale of cards used to deliver benefits through the Supplement Nutrition Assistance Program. It adds cash value each month to a card a low-income family or individual can use to buy food at participating stores. A family of four earning $39,360 or less may be eligible for SNAP.

Illegal trafficking happens when cards are exchanged for cash, services or anything other than food. Often it is a store willing to pay cash for pennies on the dollar for a card.

This kind of fraud is more prevalent in cities such as Reading, York, Erie Wilkes-Barre and Scranton, where there are many stores accepting benefits and many SNAP card holders, Beemer said.

Some stores engaging in trafficking collect many cards, then take them to club stores and buy bulk items, which they then sell on their own shelves, Beemer said.

“We want to stop vendors and store owners from taking advantage of people taking the food often times out of the mouths of children, so the vendors can use it for financial gain,” Beemer said.

The inspector general was in Berks County on Thursday to announce his office’s new focus on the crime, including a team exclusively focused on SNAP trafficking and enhanced investigative powers. A law passed in July allows the office to search buildings and use undercover investigators to build cases.

As long as the card has a cash value on the street, the crime contributes to the opioid crisis, Beemer said. Some SNAP card holders use the money from a trafficked card to buy drugs or other items that divert funds away from food for the rest of the month, he said.

“More people could be getting food if we did not have this kind of waste,” Schwank said.

Anyone aware of a store that is willing to give cash instead of food for a SNAP card should call the state Department of Human Services’ fraud hotline.

In Harrisburg one tip led to multiple arrests and the dismantling of a $1 million food stamp ring, Beemer said.

Card holders are likely to lose benefits for a year or more if caught selling their card.

“We have people in the commonwealth who are lifetime banned from obtaining benefits because of the number of instances of fraud,” Beemer said.

A fraudulent transfer of SNAP funds under $1,000 is a misdemeanor; over $1,000 it is a felony in the third degree. The penalties are the same for card buyers and sellers.

Contact Beth Brelje: 610-371-5022 or bbrelje@readingeagle.com.