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SNAP benefit updates increase the risk of fraud

In August, the Biden administration announced that millions of Americans will receive increased Supplemental Nutrition Assistance Program (SNAP) benefits. That’s good news for SNAP’s 42 million beneficiaries, who are struggling to keep food on their tables.

It also presents a growing challenge for state and local agencies. Those expanded benefits make SNAP an even more tempting target for fraudulent activity. So how can government agency leaders and staff be ready?

Why are SNAP benefits increasing?

Very simply, the federal government recalculated the program’s guidelines. The U.S. Department of Agriculture (USDA), which administers SNAP, uses its Thrifty Food Plan to determine how much it would cost to maintain a healthy diet based on USDA food group and nutrition guidelines. So as the value of the U.S. dollar changes, and food prices have increased, the administration adjusts the benefits of the SNAP program.

Previously, the national average SNAP benefit per person has been about $125 per month. Based on new calculations, the average SNAP benefit will increase by $36.24 per person per month starting October 1. This is a 29% jump in benefits — a historically large increase. Such a large jump in distribution is bound to attract the attention of those who would seek to nefariously take advantage of the program, much like when pandemic relief efforts in 2020 increased unemployment benefits.

How big of a problem is SNAP fraud?

Looked at solely as a percentage, SNAP fraud doesn’t appear to be huge — a little less than 1% of the total benefits paid out, based on recent estimates. But the rate has been growing. According to the USDA data, SNAP fraud jumped to $592.7 million in 2016, up 61% from $367.1 million in 2012. The increase might be due to more rigorous vigilance: In 2016, the number of fraud investigations rose more than 30% over 2012.

At the same time, it’s worth noting that SNAP benefits disbursed in 2016 were $66.5 billion, compared to $74.6 billion in 2012. Based on the total disbursements for both years, the “fraud rate” went up from 0.5% in 2012 to 0.9% in 2016. In other words, identified SNAP fraud jumped even as fewer benefits were being paid out.

How bad could SNAP fraud get today?

In 2020, due to the increased need for financial assistance during the pandemic, SNAP spending rose to nearly $90 billion, which was almost a 50% leap from 2019, when total payments were just over $60 billion. And the numbers have continued to climb. For instance, in May 2021, SNAP benefits totaled $10.4 billion, compared to $7.7 billion in May 2020.

It’s difficult to estimate how much this will add up to on an annual basis. As employment opportunities open up, fewer people may need SNAP. But assuming a 1% fraud rate and the upcoming increase in allotted benefits, SNAP fraud nationwide could reach up to $130 million per month. So as these changes are implemented, state and local agencies must be ready to combat and investigate fraudulent activity.

What can be done to prevent SNAP fraud?

The job of rooting out SNAP fraud usually falls on regional law enforcement (including states and counties) or federal agents working with U.S. district attorneys.

If your agency or department is charged with ensuring that SNAP benefits are being used properly, you know that it’s best to stop fraud before it occurs. This is usually done by combing through agency records data to surface indicators of fraudulent activity. But this isn’t just for new filers, as fraud can occur at any point in the SNAP applicant lifecycle.

Keeping tabs on all this is a big job, of course — one that requires a digital solution that can verify and help ferret out the bad actors from fraudulently submitting untruthful information across multiple data points.

Thomson Reuters CLEAR is a fast and reliable investigative tool designed to strengthen your existing fraud prevention processes by identifying risks and informing your agency when further due diligence is necessary. This investigative solution quickly collects and analyzes government data sets, presenting the most relevant search results in a user-friendly customizable dashboard. It can help make your program integrity work, well, a snap.

Learn more about how Thomson Reuters CLEAR can help you protect the public’s trust in your program.

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