Fact Check: The Frequency of Welfare Fraud

Image: falseStatement: Twenty-four percent of new welfare applications in San Diego County contain some form of fraud, the Los Angeles Times reported Oct. 4 based on information provided by John Haley, who oversees financial crime prosecutions for the District Attorney’s Office in San Diego.

Determination: False

Analysis: In early October, the Los Angeles Times reported that welfare recipients have spent millions of dollars in welfare payments out of state, in some cases dropping dough in vacation hotspots like Las Vegas and Hawaii.

Welfare recipients are allowed to leave California with permission from their case workers, but the Times wanted to know how authorities are monitoring those cases for fraud. It wrote:

County investigators, who state authorities say are responsible for rooting out fraud and abuse, typically don’t question a recipient’s whereabouts until transactions on a welfare card show that he or she has been gone for more than 30 days.

“If it’s a one-time thing in Miami, we would never check that out,” said John Haley, commander of the financial crimes division of the San Diego County district attorney’s office, who said 24% of all new welfare applications in his jurisdiction contain some form of fraud. “We look for patterns of abuse.”

San Diego County’s approach to welfare fraud has come under intense scrutiny in recent years as state and county authorities implemented stricter rules. Advocates for the poor argue the new policies made it harder for eligible people to receive welfare, allowing the needy to fall through the county’s safety net.

In defense of stricter policies, state and county officials have pointed to statistics showing rampant fraud.

The state prosecutes for fraud in cases where people knowingly used false information for gain. By using the word “fraud,” the District Attorney’s Office indicated that nearly one out of every four welfare applicants in San Diego County intentionally tried to deceive county workers to receive benefits.

But that’s not what the figure actually represents. It includes both intentional misrepresentations and unintentional errors, such as information being taken down incorrectly by the county.

When we called Haley about the statement, he said the number refers to all welfare applications reviewed by investigators between 2001 and 2009 that contained discrepancies. The office looks for discrepancies regarding the whereabouts of children and absent parents, unreported income or property, the whereabouts of applicants, and the existence of felony arrest warrants, Haley said.

Not all of those application issues rose to the level of fraud, however.

“It could be that they lied on the application,” Haley said. “It could be that the person who took the application information took it down wrong.”

The LA Times used the 24 percent number because that’s how Haley described it to the newspaper’s reporter. Haley said he used the term “fraud found” even though he was actually talking about the larger pool of all discrepancies.

“‘Fraud found’ is the terminology that we use,” he said.

The Los Angeles Times reporter, Jack Dolan, declined comment.

Since the 24 percent statistic doesn’t represent confirmed cases of fraud, we’ve called the statement false.

To be clear, we’re not faulting the newspaper. It’s reasonable to assume that the phrase “fraud found” means that there was indeed fraud found. Failing to clarify its broader definition was Haley’s error.

It’s also worth noting that the statistic doesn’t represent a complete picture of welfare applicants. Fraud investigators at the District Attorney’s Office only review a sample each year.

During the last fiscal year, for example, the county received 120,000 applications for food stamps and welfare. County investigators reviewed 26,000 of those applications and found 26 percent contained discrepancies, said Dale Fleming, strategy director for the county’s Health and Human Services Agency.

If you disagree with our determination or analysis, please express your thoughts in the comments section of this blog post. Explain your reasoning.

You can also e-mail new Fact Check suggestions to factcheck@voiceofsandiego.org. What claim should we explore next?

Please contact Randy Dotinga directly at randydotinga@gmail.com and follow him on Twitter: twitter.com/rdotinga.

 

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Randy Dotinga

Randy Dotinga

Randy Dotinga is a freelance contributor to Voice of San Diego and president of the American Society of Journalists & Authors. Please contact him directly at randydotinga@gmail.com and follow him on Twitter: twitter.com/rdotinga

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