When most folks hear about welfare fraud, they imagine some low-level criminal scamming a welfare program. But while that does happen, the most troubling and lucrative welfare abuse comes from big business and the state agencies that benefit from looking the other way.
On the latest episode of the Drill Down podcast, Peter Schweizer and Eric Eggers examine the shocking nature of institutional welfare fraud by focusing on a critical aid program: SNAP, which used to be known as the food stamp program.
In recent years, SNAP transitioned from the old stamp system to one using plastic cards, just like your personal credit card. Companies like JP Morgan and Conduit handle the financial services involved in SNAP, and they make a killing off of it.
They make a killing, in part, because of benefit rollovers that accumulate on the card if funds are not spent. These cards can then be sold on the black market for face value—sometimes for thousands of dollars. Those corporations make money when those illegally sold SNAP cards are used.
But don’t expect your state government to report that fraud.
States get more federal money for reporting lower fraud rates. In Florida, for example, the DeSantis administration had to settle for $17.5 million due to underreporting fraud in 2021.
Fraudulent fraud reports may seem too on-the-nose, but that is the current state of welfare in America.