Notes additional systemic problems with EBT card security, other possibly fraudulent activity
HARRISBURG – Auditor General Eugene DePasquale today issued an interim audit report to the Department of Public Welfare calling for immediate action after finding more than $200,000 in benefits were provided to 138 electronic benefit transfer (EBT/ACCESS) cards related to Social Security Numbers of deceased individuals.
The report also outlines other systemic deficiencies in the EBT/ACCESS system.
“DPW must investigate how and why its systems provided hundreds of thousands of dollars in benefits to 138 ACCESS card accounts with Social Security Numbers matching those of dead people,” DePasquale said. “Systemic problems must be corrected, better procedures must be put in place — and used — to prevent this from happening again, and any suspected fraud must be referred to the Office of Inspector General for investigation.
“I want to be clear, auditors did not find evidence of widespread recipient fraud. What they found indicates a significant systemic issue with the Department of Public Welfare’s oversight of the EBT card system. We are still waiting for DPW to provide details about the activity on 138 accounts.”
EBT cards, also known as ACCESS cards, provide public assistance recipients with electronic access to their benefits from a variety of programs, including Temporary Assistance for Needy Families, the Supplemental Nutrition Assistance Program (SNAP) and employment-related expenses.
The EBT activity associated with these 138 accounts shows that between July 2011 and March 2012, DPW provided $212,000 in benefits — at least 10 months after the Social Security Administration reported the death of the individual whose Social Security Number is associated with the card. Eight of the SSNs are associated with people who died in the 1980s.
Nearly $200,000 in benefits was withdrawn from the cards during the review period. That means that every time DPW put money on the card, and every time it was withdrawn, DPW missed an opportunity to flag and stop the activity.
In one case, a DPW staffer’s comments and concerns at the time an ACCESS card was issued — two years after the Social Security Administration reported the death of the individual — were not enough to trigger a investigation for six years. Over those six years, auditors note this recipient intermittently received estimated cash benefits of $10,000 and SNAP benefits of $22,000.
Six years after this account was inappropriately opened, DPW finally closed the account after its income eligibility system identified that the Social Security Number was associated with a deceased individual. Auditors also noted that there is no indication that DPW turned this case over to the Office of Inspector General for investigation of potential fraud.
“We appreciate the Department of Public Welfare’s willingness to cooperate with us on this audit. What we have found so far raises serious red flags regarding potential for EBT/ACCESS card fraud that DPW needs to know about now so that they can begin to resolve the issues while the audit work continues,” DePasquale said.
In previous reports from the Department of the Auditor General there was a wide range of what the potential fraud could be because DPW did not cooperate and supply all the necessary data.
“I want to ensure that resources are available for people who truly need assistance and to make sure that DPW is doing its job to prevent and detect fraud,” DePasquale said. “DPW must take immediate action to investigate the concerns raised in this interim report to assure taxpayers that the funds are properly expended and ensure the resources are available for families who are truly in need of assistance.”
Auditors also found 15 individual high-dollar, un-documented, EBT transactions between $3,000 and $10,000 each from July 2010 through March 2012 that may contain fraudulent activity. The interim report recommends that DPW review these transactions to assess if these recipients were eligible to receive these benefits and if not, work with the Office of Inspector General, the authority charged with investigating welfare fraud, to recover the money.
The interim report also noted weaknesses in the monitoring of blank EBT/ACCESS cards at county assistance offices, including lack of sufficient card inventory procedures, inadequate review of card tracking logs, and interference by one DPW bureau over another bureau responsible for independent internal examinations of EBT/ACCESS card security procedures.
The interim report is a follow-up to 2009 audit and 2011 special report that found serious deficiencies with DPW’s management of the EBT/ACCESS card program. The current audit was launched in 2012 after DPW agreed to provide EBT/ACCESS card usage data that was denied several times in 2010 and 2011.
The complete audit of the DPW’s EBT program is expected to be completed in 2015.
The interim audit report is available online here.