Butler County cracking down on food stamp fraud

Law enforcement officers gather outside U.S. Beef in Fairfield, Wednesday, Aug. 26, 2015. Dozens of people were targeted for arrest in the Fairfield and Hamilton areas as part of a lengthy food stamp fraud investigation that included federal, state and local law enforcement agencies. GREG LYNCH / STAFF
Caption
Law enforcement officers gather outside U.S. Beef in Fairfield, Wednesday, Aug. 26, 2015. Dozens of people were targeted for arrest in the Fairfield and Hamilton areas as part of a lengthy food stamp fraud investigation that included federal, state and local law enforcement agencies. GREG LYNCH / STAFF

Credit: Nick Graham

Credit: Nick Graham


BY THE NUMBERS

From July 2014 to June 2015:

413 allegations of food stamp fraud to investigate

108 people arrested

93 people convicted

Source: Butler County Job and Family Services

Jerome Kearns was minding his own business while shopping at a local Kroger recently when a couple approached him and asked if he would let them pay for his food items with their food stamps.

In exchange, they wanted Kearns to pay for some of the groceries they had in their shopping cart that were banned by food stamp restrictions.

“They said, ‘Hey, we can’t buy certain things with our food stamp card,’ and I said, ‘Yeah, I understand that,’” Kearns recalled. “The guy kept talking, and I said, ‘Let me introduce myself to you.’ I said, ‘I’m Jerome Kearns, and I work for the Department of Job and Family Services.’

“The guy blew me off, and his girlfriend or wife said, ‘We need to go.’”

Kearns, the director of Butler County Job and Family Services, said that kind of food stamp fraud is a common both locally and nationally. From July 2014 to June 2015, the county has investigated 413 allegations of food stamp fraud, arrested 108 people, and secured 93 convictions.

Butler County officials estimate they have saved taxpayers $17 million since 2012 by detecting and often arresting fraudulent food stamp users. An 18-month undercover investigation that ended Wednesday with raids at several homes and businesses in Butler and Hamilton counties and the arrests of 14 people broke up a food stamp fraud operation that bilked taxpayers out of more than $2 million that was supposed to be part of the Supplemental Nutritional Assistance Program, commonly known as food stamps, for low-income residents.

That $2 million represents about 40 percent of the $5.3 million lost to SNAP in retail fraud in Ohio during 2014. The nationwide loss is estimated at $173 million.

Kearns said busts like the one Wednesday are evidence that federal, state and local officials are doing a better job of ferreting out food stamp trafficking. Job and Family Services and the Butler County Sheriff’s Office formed a partnership three years ago to attack the problem.

A year and a half ago, county commissioners approved funding to add a third sheriff’s deputy to the food stamp fraud investigation unit, an investment that paid dividends with more arrests and convictions that ultimately saved taxpayers an estimated $5.4 million.

Kearns said most of the trafficking cases the county deals with aren’t like the massive operation that was allegedly occurring at U.S. Beef Cincinnati, 3210 Profit Drive, and Butcher Shop Food Distributors LLC, 300 Commercial Drive, in Fairfield.

The owners, managers and other employees of the door-to-door meat retailers allegedly repeatedly redeemed food stamps in exchange for ineligible items, including money, Oxycodone, heroin and marijuana.

“(Truck drivers) take SNAP or food stamp cards … and purchase the cards for 50 cents on a dollar cash,” said Butler County Sheriff Richard Jones. “The company at that point is turning it into the state for 100 percent reimbursement.

“They are gypping the system and making us all pay for it,” he said.

Between December 2011 and May 2015, more than 8,000 suspected fraudulent SNAP transactions were made for U.S. Beef Cincinnati, totalling approximately $1.1 million, according to United States Department of Agriculture records.

The state only keeps track of people who lie on their applications for food assistance, not retail or trafficking cases.

“Last year, ODJFS uncovered 2,176 intentional program violations totaling $3.6 million. These are primarily cases where individuals lied on their applications in order to receive SNAP benefits for which they were not eligible. In the same year, ODJFS issued a total of $2.6 billion dollars in SNAP benefits to approximately 840,000 households,” said Ben Johnson, spokesman for the Ohio Department of Job and Family Services.

“Intentional program violations account for about 0.1 percent of benefits paid. The vast majority of SNAP recipients are good people who use the program as it was intended.”

Food stamps can be used to buy things such as breads and cereals; fruits and vegetables; meats, fish and poultry and dairy products. Non-food items such as diapers, alcohol and cigarettes are banned, as are prepared foods.

Since “luxury” items such as steak and seafood or junk food are food items, they can be purchased with SNAP cards, according to the United States Department of Agriculture website, which delineates and approved and disapproved food stamp items.

“Several times in the history of SNAP, Congress had considered placing limits on the types of food that could be purchased with program benefits,” a message on the site reads. “However, they concluded that designating foods as luxury or non-nutritious would be administratively costly and burdensome.”

Kearns said there are all kinds of food stamp fraud, such as SNAP card holders swapping their cards for cash, which is pretty easy, since identification at the grocery store is not necessary. All people need is their card and PIN (personal identification number) to make purchases.

State Sen. Bill Coley, R-Liberty Twp., said the legislature always has its eye on things like food stamp fraud, but to date, no one has sounded an alarm that new laws, such as requiring identification, are necessary. Plus, he said they wouldn’t want to spend more money on a perceived solution than the cost of the problem itself.

“The prosecutors are not telling me that they need more laws to stop this kind of stuff,” Coley said. “So we don’t want to just not think this through and make rules that make it impossible for people on a day-to-day basis to procure food, when what these guys (the people arrested Wednesday) were doing was wrong.”

Butler County Sheriff’s Lt. Todd Langmeyer, who heads up the food stamp fraud team for the sheriff, said they get a lot of tips from the public about food stamp abuse.

“We get a lot of tips from the community because they know that the people that are abusing the program are spending their tax dollars,” he said. “There’s a lot of people on the street that abuse the program that think of it as free government money. Well, there is no such thing as free money. It comes from somewhere, it comes from people who are working. People get frustrated when they see the abuse taking place.”