Looking for fraud in all the wrong places

Public benefits fraud committed by people experiencing poverty is quite rare. For example, in the Supplemental Nutrition Assistance Program (SNAP), the federal government has found an overpayment rate of only 0.1 percent, or just a dime for every $100. I was invited to testify before the U.S. House of Representatives’ Subcommittee on Government Operations in a March 31 hearing on “Tackling Improper Payments for more Equitable Service Delivery.” During the hearing, other experts raised concerns that state agencies aren’t prioritizing improper payments. However, my experience as a caseworker has only underscored that we have this all wrong.

The reality is that despite the rarity of fraud, legislators and state agencies DO prioritize fraud prevention. But last month’s hearing made clear that states are looking for fraud in all the wrong places.

One of the other experts at the hearing, Linda Miller who focuses on fraud risk management, discussed how the main actors in fraud, particularly in unemployment benefits, are international rings, cyber security hackers, and identity theft operations from other countries. These entities are stealing the identities of people dead or alive to apply for benefits. But none of these actors are individuals experiencing poverty. However, all current fraud prevention measures that states use specifically target individuals.

There are millions of dollars in grants and targeted funding for fraud prevention and “program integrity.” SNAP and other benefit programs have rigorous application and eligibility processes, and caseworkers are often better trained to look for fraud than to provide trauma-informed care or to refer families to critical assistance addressing the many challenges of living in poverty. I know from my experience that caseworkers are very likely to be penalized or threatened with losing their jobs for accidentally approving recipients for more benefits than they are eligible for. Yet they aren’t penalized for denying or shortchanging benefits to eligible people.

Legislators and administrators too often send the simple message that they want more disqualifications for improper payments and fraud. However, this method hasn’t resulted in a reduction in improper payments because:

  1. Most improper payments are honest mistakes by eligibility workers or recipients facing complex eligibility rules. The more difficult the application processes are, the more administrative burdens placed on recipients and caseworkers—causing more opportunity for errors.
  2. State technology systems are out of date and ill-equipped to defend against high-tech cyber security threats, international fraud rings, and identity theft, which experts have labeled as the main culprits in programs like unemployment benefits.

Instead, efforts to “rein in fraud” further perpetuate stereotypes. Our nation has a long history of assuming fraudulence based on poverty and race. Harmful, racist tropes about laziness, untrustworthiness, and criminality were used to justify the forced labor of Black people and are still reflected in many U.S. policies today.

In the last 50 years, policymakers have used tropes like the discredited “welfare queen” to insinuate that people experiencing poverty—especially Black people—are fraudulent and must be forced to work. Legislators have used this dog whistle to justify benefit cuts while increasing spending to protect program integrity. Even those promoting public benefits expansions have reinforced stereotypes by emphasizing that programs should only serve the so-called “deserving poor.”

Encouraging more fraud provisions without specifying the how or who also contributes to the harmful and pervasive culture in state agencies inviting abuses that terrorize innocent people in need. During the hearing, another expert mentioned that we must control fraud or Americans will begin to experience invasions of privacy, including video surveillance in homes. But many receiving public benefits are already experiencing severe privacy invasions and over-policing. For example, fraud agents—some carrying guns—pop up unannounced to search people’s homes for evidence and even threaten to take their children. Because these instances are so pervasive, it’s no surprise that people receiving public benefits often live under a cloud of fear.

At the hearing, members of Congress suggested there is bipartisan agreement that we must crack down on fraud to ensure fairness and ethical use of funds. But there is nothing fair or ethical about blaming systemic shortcomings on individual people. Of course, no program can survive without taking abuses seriously. However, when actions to improve program integrity have a strong negative and racially skewed impact that decreases access to basic life necessities, policymakers have a moral obligation to find less harmful ways to fight fraud. The first step is to begin looking in the right places and dismantling cultural norms in agencies that perpetuate mistreatment, stereotypes, and privacy invasions.

Parker Gilkesson is a senior policy analyst at the Center for Law and Social Policy in Washington, D.C. She previously worked as a human services specialist in Mecklenburg County, N.C.

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