CIA SPECIAL REPORT PART 2: Investigating Welfare Fraud & Abuse - Spokane, North Idaho News & Weather KHQ.com

CIA SPECIAL REPORT PART 2: Investigating Welfare Fraud & Abuse

Posted: Updated:

SPOKANE, Wash. - How is your money being spent? Are your tax dollars really putting food on the tables of hungry families? Or are they actually helping to fuel someone's addiction? You might be surprised to hear the answer.

Wednesday night KHQ Local News introduced the Center for Investigative Action, our commitment to report on taxpayer abuse and hold the powerful accountable. In part one of her report KHQ Local News Reporter Chelsea Kopta uncovered the stunning abuses of the food stamp card, called an EBT card. Thursday night Chelsea revealed a new twist to the welfare scam: recipients skirting the law to use your money at casinos and liquor stores.

Washington's Welfare program is run by the Department of Social and Health Services (DSHS). There are two forms of benefits on this card: food stamps to help

feed families and cash benefits designed to help families pay for their monthly bills.

But our CIA investigation found some people are using taxpayer's wallets like their personal ATM's.

The scheme is simple: walk into a convenience store, flash the clerk the EBT card and ask to use the cash side. Then, despite regulations on what recipients are supposed to buy, the customer can purchase whatever the clerk will allow. Often times that includes beer and cigarettes, both against state law.

It's no surprise to former convenience store worker Julie Foster.

"I'd go to work and then there were people coming in to buy just anything they wanted: cigarettes, alcohol," she said.

For Foster, the use and abuse of Washington's welfare program hit home especially hard. She too needed welfare benefits to support her family. "How could you?" She thought after watching the abuse. "How could you take the money away from a child or elderly person that really needs that extra help?"

Problem was, Foster said, there wasn't much she could do to stop it. "I was told it wasn't our business."

So KHQ went in search of other mini-marts to see how bad the problem was. It didn't take long. At our first stop at Hai's Mini Market on Crestline, clerk Chris Tao admitted he's seen welfare fraud.

KHQ asked, "Do you see people using the cash to buy cigarettes, beer or alcohol, anything like that?"

Tao responded, "In here? Sometimes."

But KHQ found fraud extends far beyond mini marts. The problem is not just limited to what some people are buying but where they are withdrawing cash from. Since EBT cards also work just like debit cards, they can be used at virtually any ATM.

KHQ requested all ATM cash withdrawals, from EBT cards, for the last three months in Spokane. We poured over thousands of records, cross-referencing every address to a local business.

Here's some of what we found: EBT transactions show someone withdrew $100 from Ringo's Casino in Spokane Valley; $180 withdrawn from the Monkey Bar in Spokane Valley; $100 drawn from an ATM inside a downtown Spokane nightclub; and $200 withdrawn from a pawn shop on east Sprague.

State investigators can track electronic transactions but once someone has cash is in hand, there's no telling what the money will be spent on.

"There's nothing that tracks where you take that cash to," Steve Lowe said, Senior Director of the Office of Fraud and Accountability with the DSHS. "Once you pull it out of the machine, we don't have any way of knowing where that cash was spent at."

So what's to stop people from buying things they shouldn't be buying?

Lowe said, "There really isn't anything."

DSHS argues, it's not as bad as it seems. Out of 8,000 ATM withdrawals in the month of May, Lowe only dubbed 45 as questionable.

Not to mention, Lowe's department, the Office of Fraud and Accountability, which promises to crack down on welfare cheats. This year, the state doubled its team of investigators from five to 10 across the state. One undercover investigator is already tracking close to three-dozen cases right here in Spokane.

As for Julie, she eventually worked her way off the welfare system. She also stopped working at convenience stores since because she said she couldn't bear being a part of the welfare fraud problem anymore.

There are more crackdowns to come for EBT recipients. Starting January 1, 2012, families on welfare will be prohibited from using their EBT cards at all taverns, beer and wine specialty stores, nightclubs, liquor stores, bail bond agencies, gambling establishments, tattoo, body piercing and body art shops, adult entertainment venues, and any establishment where people 18 and under are not allowed to be.

If you think you know of any welfare fraud, the Office of Fraud and Accountability wants to hear from you. The fraud hotline is 1-800-562-6906.

 

RESOURCES:

Washington Department of Social and Health Services (DSHS): http://www.dshs.wa.gov/

DSHS Office of Fraud and Accountability: http://www.dshs.wa.gov/fraud/

DSHS Fraud Hotline: 1-800-562-6906

  • Most Popular StoriesMost Popular StoriesMore>>

  • UPDATE: PHOTOS Of Sex Offenders Who Live In Kootenai County

    UPDATE: PHOTOS Of Sex Offenders Who Live In Kootenai County

    Wednesday, February 26 2014 6:50 AM EST2014-02-26 11:50:17 GMT
    KHQ.COM - Do you know who lives next to you, or in your neighborhood? KHQ has teamed up with local law enforcement agencies to keep you updated on sex offenders that may be living close to you. The latest photos are from the Kootenai County Sheriff's Office website. All of the offenders have served their time and are not wanted by authorities.>>
    KHQ.COM - Do you know who lives next to you, or in your neighborhood? KHQ has teamed up with local law enforcement agencies to keep you updated on sex offenders that may be living close to you. The latest photos are from the Kootenai County Sheriff's Office website.>>
  • SPREAD THE NEWS: WSP Looks For Man Charged With 59 Counts Of Sexual Misconduct With Children

    SPREAD THE NEWS: WSP Looks For Man Charged With 59 Counts Of Sexual Misconduct With Children

    Wednesday, April 16 2014 3:59 PM EDT2014-04-16 19:59:12 GMT
    KHQ.COM - The Washington State Patrol’s Criminal Investigation Division has been assisting Minnesota’s Pine County Sheriff’s Office in attempts to locate a subject charged with 59 felony counts of Criminal Sexual Conduct involving two young females.>>
    KHQ.COM - The Washington State Patrol’s Criminal Investigation Division has been assisting Minnesota’s Pine County Sheriff’s Office in attempts to locate a subject charged with 59 felony counts of Criminal Sexual Conduct involving two young females.>>
  • LOOKING FOR A HOME? 10 Homes For Sale In Spokane For $125,000

    LOOKING FOR A HOME? 10 Homes For Sale In Spokane For $125,000

    Thursday, April 17 2014 9:50 AM EDT2014-04-17 13:50:17 GMT
    SPOKANE, Wash. - Spring is a popular time to purchase and sell a home. Here are 10 homes for sale in Spokane for $125,000. These homes were found on www.WindermereSpokane.com. If you would like more information on any of these homes or would like to schedule a tour, contact your real estate agent with the correct MLS number.>>
    SPOKANE, Wash. - Spring is a popular time to purchase and sell a home. Here are 10 homes for sale in Spokane for $125,000. These homes were found on www.WindermereSpokane.com. If you would like more information on any of these homes or would like to schedule a tour, contact your real estate agent with the correct MLS number.>>