Where federal food stamp money really goes: Criminal fraud

Thursday, September 19, 2013 by: J. D. Heyes
Tags: food stamps, criminal fraud, taxpayer money

(NaturalNews) There is a biblical adage that deals with the concept of self-reliance which goes something like this: "If you give a man a fish, you feed him for a single day; if you teach him to fish, you feed him for a lifetime."

Unfortunately, the American welfare system isn't based on this concept. In fact, it has been so politicized over the years by self-centered men and women whose only aim in life is to use it and other federal "incentives" to remain in power, that the one thing it doesn't do is encourage recipients to better themselves.

As bad as that is - and as damaging as it is to an entire segment of society - what is worse is that the manner in which welfare programs are set up makes them ripe for abuse...and as such, they are abused, just like the taxpayers who fund them.

Breitbart News cites just one recent example:

Arizona authorities have broken up a massive food stamp fraud ring in Phoenix and seized almost $700,000 in cash. K&S convenience store workers Kameel Sweiss, Ameer Sweiss, and Faday Sweiss were arrested on Wednesday on charges of suspicion of illegally conducting an enterprise, fraudulent schemes and artifices, money laundering, unlawful use of food stamps, and computer tampering. "People were essentially selling their cards to [the] store," said spokesperson Stephanie Grisham.

Organized fraud in a system built for it

This isn't new. The state's attorney general, Tom Horne, said that that bust is the fifth of its kind so far in 2013, though it was the largest to date. Horne told Fox News host Neil Cavuto that the crime of food stamp fraud is a large and growing problem; nearly 48 million Americans - more than are part of the chronic "uninsured" - are now receiving some form of taxpayer-funded food stamps.

Horne explains:

"It's done in two ways. One way is a small purchase, say, a bag of potato chips, treated as though it were a very large purchase, and then they will give the customer some cash in addition to the potato chips, or they will just give them their card--let's say there's $300 on the card. They will give them $100, and then they have $200 left on the card, and they will keep ringing up as though they're sales during the day, and they will end up with that $200."

What's more, as exposed by Breitbart News, EBT cards are a huge business for corporate America - namely, JP Morgan, which earned at least $560,492,596 since 2004, in processing "EBT cards of 18 of the 24 states it has under contract for the food stamp program."

JP Morgan's Christopher Paton told Bloomberg News:

"We are the largest processor of food stamps in the country...[the EBT program] is a very important business to JP Morgan. It's an important business in terms of its size and scale.... Right now volumes have gone through the roof in the past couple of years or so. The good news from JP Morgan's perspective is the infrastructure that we built has been able to cope with that increase in volume."

Fraud, like the food stamp figure, is growing

As for food stamp fraud, a big part of the problem is the way the program is set up and permitted to operate. The other part of the problem is that there is virtually no oversight - and that has to be intentional.

For instance, while there are thousands of employees who work for the Department of Agriculture, there are only 100 tasked with monitoring EBT fraud (and remember, there are nearly 48 million EBT card users).

In 1969, a mere four years after President Lyndon B. Johnson declared his "war on poverty," just 2.8 million Americans were on food stamps.

Sources:

http://www.breitbart.com

http://www.bloomberg.com

http://www.fns.usda.gov