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Saturday, August 17, 2013

Food Stamp Trafficking Up 30% From 2008 to 2011 [Updated]

    The U.S. Department of Agriculture* (USDA) released a report on Thursday regarding illegal trafficking in the Supplemental Nutrition Assistance Program (SNAP), more commonly known as food stamps.  The report showed that the rate of trafficking rose from 1% of total benefits in the last study period of 2006-2008 to 1.3% in the current study period of 2009-2011, an increase of 30%.  The report noted the trafficking rate remains well below a rate of almost 4% that existed for much of the 1990s.  The rate plunged to 1% by the 2002-2005 study period and remained there until the current report:


    While the rate remains relatively low, the sharp increase in the SNAP program means the total annualized dollar amount of fraud reached a record level of $858 million, exceeding the $811 million from 1993.  This value had been dropping dramatically to a low of $241 for 2002-2005, then ticked up to $330 million in 2006-2008 before exploding in the current report to $858 million.


    The report attributes much of the dollar increase to the growth in SNAP.  Total redemptions more than doubled from 2008 to 2011:
A substantial portion of this increase is due to the growth in the program, where redemptions totaled $36 billion in 2008 (the last year of the previous study period), then increased to $55 billion in 2009 (the first year of present study period) and eventually to $73 billion in 2011. 
    The latest figures show that SNAP redemptions rose again in 2012 to $74.6 billion.
    The USDA study also found that the percentage of authorized SNAP stores engaging in trafficking went from 8.2% in 2006-2008 to 10.5% in 2009-2011, a 28% increase, but still not as high as an 11.7% rate in the 1990s.
    Although food stamp trafficking is illegal, the report notes that
trafficking does not increase costs to the Federal Government, it is a diversion of program benefits from their intended purpose of helping low-income families access a nutritious diet.
    In conjunction with the release of the report, the USDA announced "Additional Measures to Improve Integrity in the Supplemental Nutrition Assistance Program."

UPDATE:

    I don't usually link to reactions to my articles, but I thought the contrast of these two was interesting:


*Corrected.  Originally said "Food and Drug Administration".

Note: A version of this article first appeared at The Weekly Standard.

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