Food stamp fraud grows in the U.S.

A recent report says that as the food stamp program has grown, so has fraud. And it's costing the government hundreds of millions of dollars.

Jeremy Hobson:Here in this country, the cost of the federal food stamp program has doubled since the recession. 45 million Americans are now getting food assistance. And a recent report found evidence of fraud in the system.

That was the topic of a hearing on Capitol Hill yesterday, as Marketplace's John Dimsdale reports.


John Dimsdale: The Agriculture Department estimates illegal food stamp schemes cost taxpayers $330 million a year. For example, stores sell prohibited items, like liquor or tobacco, in return for food stamp cash. Despite electronic tracking, fraud can be difficult to uncover.

At yesterday’s hearing, Pennsylvania’s Inspector General Kenya Faulkner, said some bars will accept food stamp cards and then take the cards to a local grocery store.

Kenya Faulkner: You never really see the bar or restaurant transaction. What you see is the recipient using to buy $200  worth of groceries at this particular grocery store. That’s a little hard to track.

Committee members, including chairman Darrell Issa, called for tougher enforcement, but without any extra money.

Darrell Issa: In fact, you’re going to have to do more for less. More oversight, more accountability.

House Republicans are backing a budget that would cut $127 billion from food stamps over 10 years.

In Washington, I'm John Dimsdale for Marketplace.

About the author

As head of Marketplace’s Washington, D.C. bureau, John Dimsdale provides insightful commentary on the intersection of government and money for the entire Marketplace portfolio.

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