LA Times claims $69 million in California welfare money drawn out of state

[The Northerner]

More than $69 million in California welfare money, meant to help the needy pay their rent and clothe their children, has been spent or withdrawn outside the state in recent years, including millions in Las Vegas, hundreds of thousands in Hawaii and thousands on cruise ships sailing from Miami.

State-issued aid cards have been used at hotels, shops, restaurants, ATMs and other places in 49 other states, the U.S. Virgin Islands and Guam, according to data obtained by The Times from the California Department of Social Services. Las Vegas drew $11.8 million of the cash benefits, far more than any other destination. The money was accessed from January 2007 through May 2010.

Welfare recipients must prove they can't afford life's necessities without government aid: A single parent with two children generally must earn less than $14,436 a year to qualify for the cash assistance and becomes ineligible once his or her income exceeds about $20,000, said Lizelda Lopez, spokeswoman for the Department of Social Services.

Round-trip flights from Los Angeles to Honolulu on Orbitz.com on Sunday started at $419 — more than 80% of the average monthly cash benefit for a single parent of two on CalWorks, the state's main aid program.

"How they can go somewhere like Hawaii and be legit on aid … they can't," said Robert Hollenbeck, a fraud investigator for the Fresno County district attorney's office. "This is money for basic subsistence needs."

The $387,908 accessed in Hawaii includes transactions at more than a thousand big-box stores, grocery stores, convenience shops and ATMs on all the major islands. At least $234,000 was accessed on Oahu, $70,626 on Maui, $39,883 on Hawaii and $22,170 on Kauai.

Read more: http://www.latimes.com/news/local/la-me-welfare-20101004,0,5787669.story?track=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed:+latimes/news/local+


Let's see if more research is done to scrutinize this...

[DJ13]

1. So the cards are being used to track recipients?

That should be the scandal in this.

[virgogal]

3. You're kidding. The fraud is okay with you?

[Xithras]

7. I doubt it's all fraud.

California has a huge expat native Hawaiian community, primarily composed of people who couldn't afford to live on the islands any longer. They end up in California because it's the cheapest flight off the islands.

My guess would be, on further investigation, that many of these are simply people who are visiting relatives on the islands. The poor ARE still legally allowed to travel, and are allowed to buy food and supplies while they do.

Some of the charges, like the cruise ships, are probably fraud, but the actual dollar figures for those were much smaller.

[EFerrari]

15. How do you know it was fraud? And I'd like to remind folks that the LA Times

has turned into a right wing rag.

[Gormy Cuss]

18. The Times article does quote several people who suggest plausible, not fraudulent reasons for out-

of-state use of welfare benefits.

The biggest issue that I have with the Times is that the article gives no sense of scale and uses a total based on THREE AND A HALF YEARS data to make it seem worse than it is.

[EFerrari]

19. This is one of those "welfare queens using ATMs at casinos" articles.

I wish people would get this pisses at the Pentagon. lol

[Xithras]

4. All electronic banking transactions are traceable by neccesity.

A system where people could just untraceably request money from anywhere in the world would be a fraudsters dream. Every time you use your bank ATM card, a record is made. The time, date, amount, and machine ID are recorded permanently.

When you get a bank statement at the end of the month, your statement will have a list of every transaction and the machines you performed them at. With benefit cards, the state gets the same list because it's the account holder. It knows where the money was spent.

[notesdev]

8. If someone is taking the public's money

the public has a right to know what's being done with it. In this particular case, it seems to have outed millions of dollars of fraud at a time when California is insolvent and on the verge of bankruptcy. Is that not a good thing? What claim to privacy can there legitimately be with respect to the public treasury?

[EFerrari]

14. No kidding. n/t

[spanone]

2. i smell fraudburgers

[Gormy Cuss]

5. 69 M divided by 3.5 years (1/2007-5/2010) is about 20 M per year.

The state of CA receives well over 3 billion dollars in TANF funds annually. If all of the out of state spending is fraudulent, it still only amounts to less than 0.67% of the funds.

[defendandprotect]

17. Exactly .... this is like suggesting to the public that it is individuals who rip off Medicare ...

while in reality it is big pharma and health care corporations which defraud government --

over and again!!

[KamaAina]

6. Um, there is a large Hawai'i expat community in California

indeed, just this past Saturday, I saw live hula and ate "local kine grindz" at a street fair here in San Jose.

It is just possible that these people may have been visiting family in Hawai'i. Maybe they flew standby. Maybe their relatives paid for their airfare.

As for the cruise ships, etc., it appears to have taken the state just as long to discover this as it did for them to figure out that withdrawals were being made at Indian casinos within the state. :dunce:

[gratuitous]

9. So it was spent out of state - so what?

If that's where I need to go to look for a job, then yes, my purchases will appear out of state. Or if I go to a family event like a wedding or a funeral, I'll probably spend some money there. Now, $69 million sounds like a lot of money; how much is that in relation to the total amount of assistance doled out by the state of California? Ah, there it is, paragraph 18:

The out-of-state spending accounts for less than 1% of the $10.8 billion spent by welfare recipients during the period covered, and advocates note that there are legitimate reasons to spend aid money outside of California. From the data provided, it cannot be determined whether any of the expenditures resulted from fraud.

But please, let's not stop any of that from a good old-fashioned game of poor bashing! Load up and let fly.

[FreeState]

10. Just under $161 Billion for welfare in the budget - 0.04% of the total spent

http://www.usgovernmentspending.com/welfare_budget_2010_4.html#usgs302

69 Million of that is about 0.04285714285714286%.... just saying

[madrchsod]

11. they saved 900,000 by canning the investigators

but they lost 9.6 million due to fraud that the investigators could have found.

[nadinbrzezinski]

12. Ah yes, the modern version of POOR LAWS

next... come badges to prove they are deserving poor.

Oh never mind me, reading on the origin of some of these attitudes.

Oh and fraud is a problem... but whatever...

[JuniperLea]

16. Ugh... Poor Laws... indeed...

I see poor people, can you hide them away from my beautiful eyes/mind?

I actually do see poor people using these cards in Downtown Los Angeles. A lot of them are homeless and happy to be able to buy a hot meal instead of the cold can they usually eat from in their SRO where cooking is forbidden.

How dare they get caught wanting while poor!

[The Straight Story]

13. Probably because they could save money out of a high tax state like CA

Which means they were good investors who spent their money wisely :)

[slackmaster]

20. According to the Yes on Proposition 25 campaign, the state is losing about $50 million per day...

...due to budget gridlock.