Welfare Fraud Statistics

Less than 50% of American adults trust the Supplemental Nutrition Assistance Program (SNAP), and many believe most users abuse it. The latest welfare fraud statistics, however, show that the payment accuracy of SNAP is over 92%, while the food stamp trafficking rate in the past few years has been only 1-1.5%. These figures show that the US authorities have found efficient solutions to food stamp fraud.

Would you like to discover the social assistance program fraud rates at home and abroad? Are you interested in which US states note the most considerable welfare fraud rate? Can you guess how much money the federal and state authorities save by fighting SNAP abuse? Discover these and many other curious stats on welfare exploitation.

Welfare Fraud Statistics (Editor’s Choice)

• Most developed countries have welfare fraud and error rates between 1-5%.
• In 2012, SNAP payment inaccuracy was under 4%.
• In the past decade, the amount of improper and fraudulent SNAP payments dropped by $3.67 billion.
• The average SNAP fraud amount per ADH disqualification is about $2,000.
• American authorities have collected about $1.6 billion in delinquent and fraudulent SNAP claims since 1992.
• Georgia recorded the highest amount of $7,155,867 in claims collected.

Global Welfare Fraud Facts and Stats

1. Australia prosecuted over 3,000 people for welfare fraud between 2008 and 2009.

In the period between 2008 and 2009, Centrelink, Australia’s welfare fraud investigator, completed 3,867,135 reviews and cancelled or reduced payments in 641,504 cases. Centrelink also prosecuted 3,388 individuals for welfare fraud, nearly all of which (3,354) were convicted. There were a total of 26,084 fraud-related investigations,and the nation’s statistics on welfare abuse show that the debt and savings involved in them was AU$113,400,000 million.

(AIC)

2. In 2003, fraud and errors represented about 3-5% of Canada’s welfare payments.

Before reaching such a low rate of welfare fraud and error, the country invested in a unique program. Back in 1994, Canada introduced the Group Information Sessions project, which informed clients on welfare programs. There’s been 225,000 sessions held and 1.7 million people educated ever since. The program is believed to have saved Canada about CA$800 million in benefit funds.

(NAO)

3. Total welfare overpayments due to fraud and error in the UK reached 2.4% in 2019/20.

UK welfare abuse statistics indicate that 1.4% of that amount was associated with fraud. The monetary value of all overpayments was £4.6 billion. The percentage of welfare fraud and error payments in universal credit was 9.4, and housing benefit followed with 6%. Pension credit and carer’s allowance accounted for a similar overpayment rate, at 5.3% and 5.2%, respectively. Employment and support allowance followed at 4%, while the lowest welfare fraud percentage of 1.5 was noted in personal independence payments.

(NAO)

4. France has among the highest benefit fraud penalties among the developed countries.

One of the government assistance abuse statistics is that benefit fraud will cost you a 3-year prison sentence and a €45,000 fine in France. Still, the French welfare fraud investigator estimates that there are between 2,000 and 3,000 benefit fraud incidents in the country per year. In 2002, there were only 300 convictions out of 700 cases of suspected welfare fraud.

(NAO)

5. The Netherlands saved over €220 million in 3 years with its unique strategy on fighting welfare abuse.

In 2003, the country introduced the ‘Slimmer, Breder, Meer Handhaven’ strategy. Estimates showed that it saved the Netherlands nearly €220 million between 2003 and 2006.

Still, benefits fraud exists in the country, and people abusing welfare aren’t that uncommon. In 2004, the abuse of welfare system statistics revealed that 22% of participants would accept a job without notifying authorities. About 11% of welfare abusers would work on the black market. Moreover, 25% admitted to not applying for a position on purpose. An additional 12% ensured they wouldn’t get a job to keep receiving unemployment benefits, which is another one of the welfare abuse examples in the Netherlands.

(NAO)

US Statistics on Welfare Fraud

6. Payment errors, including fraud, are significantly lower than in 2000.

In 2011, the rate of all SNAP payment errors was about 50% lower than the rate recorded ten years ago. Over that period, the size of improper SNAP payments and fraud was decreased by an impressive $3.67 billion. Welfare facts and statistics show that the main reason for this positive change was the stricter certifying and investigation rules. Both prevent giving benefits to ineligible individuals and help detect fraudulent activities such as selling food stamps.

(USDA)

7. Over 8,300 retail stores have been permanently removed from SNAP due to trafficking.

Trafficking has become the number one enemy of SNAP. The USDA has therefore adopted a zero-tolerance policy for such food-stamp abuse, according to SNAP abuse statistics. Trafficking used to represent about 4% of all SNAP payments but has been reduced to about 1%. In 2012 alone, investigators conducted about 4,500 undercover investigations and reviewed more than 15,000 participating stores. More than 8,300 stores were disqualified from SNAP due to food stamps trafficking.

(USDA)

8. In 2016, the authorities collected claims worth over $400 million.

One year before, the total claims collected totaled $366.6 million, or 9.69% less than the $402 million recorded in 2016, as evidenced by welfare abuse facts. The largest share ($166 million) from these claims came via the Treasury Offset Program. The remaining $155.3 million and $80.6 million came from claims collected via recoupment and other collection methods. 

(FNS)

9. The average amount of SNAP fraud per ADH disqualification is about $2,000.

In 2016, the average amount of fraud per disqualification from Administrative Disqualification Hearings (ADH) in the US was $2,143. There were a total of 46,953 disqualifications from ADH (waivers and convictions) that year. The total associated SNAP program loss was stunning $100,641,327, according to statistics on food stamp abuse.

(FNS)

10. Fraud represents only 10.72% of all SNAP claims.

In 2016, the total food stamps claims totaled $684,197,891. Fraud claims, however, contributed only $73,403,758 towards that amount, or 10.72%. The highest share of $421,934,288 of recipient claim dollars saved came from household error claims. Finally, agency error claims were responsible for the remaining $188,859,846, as suggested by food stamp abuse statistics.

(FNS)

11. Fewer than half of American adults trust the SNAP program.

About 47% of adults in the US think that food stamps are beneficial, according to a YouGov food stamp abuse study. More than half, however, don’t trust the program and worry about fraud. Even a lower share of Americans (40%) trust in the Temporary Assistance for Needy Families (TANF) program. Medicare, Social Security, and the Children’s Health Insurance Program note the highest trust rates of 57%, 55%, and 52%, respectively.

Facts about welfare abuse show that SNAP fraud rate misinformation and the myth of the ‘welfare queen’ are the main reasons why most Americans distrust the program. Still, SNAP abuse is the least likely to happen. The program has rigorous application and review processes alongside multi-level eligibility checks. Only about 14 in every 10,000 US households enrolled in SNAP commit fraud.

(YouGov)

Food Stamp Fraud Statistics by State

12. New York and California are the states with the most SNAP fraud investigations.

In 2016, a total of 450,976 investigations were completed in California. This accounts for nearly half of all investigations (963,965) completed that year in the US. Most of those (296,989) were positive pre-certification investigations. With a total of 156,858 inquiries completed, New York came in second on the list.

Food stamp abuse facts show that the other states with a notable number of completed investigations didn’t even come close to these figures. For example, the states after New York were District of Columbia (43,290), Michigan (40,716), and West Virginia (37,559).

(FNS)

13. New Mexico recorded only 40 completed SNAP fraud investigations in 2016.

There weren’t any negative or positive pre-certification inquiries in the state. According to stats on welfare abuse, New Mexico had only 13 and 27 negative and positive post-certification investigations. Other states that deserve a mention in this category are Guam (267), Maine (294), North Dakota (350), and South Carolina (344). It’s also interesting to note that Arkansas recorded zero negative and positive post-certification inquiries in 2016. However, those figures were under review by the state authorities.

(FNS)

14. Massachusetts had the highest average fraud amount per SNAP disqualification from ADH.

The state’s average SNAP amount of fraud was stunning $14,526. The only other state that came near this figure was New Mexico with an average of $12,743 per disqualification. All the other states had significantly lower average fraud amounts in 2016, as suggested by welfare abuse stats. For most of them, the average was between $1,000-3,000. Many of the states, including Missouri, Alaska, and North Dakota, had an average fraud loss per disqualification under $1,000.

(FNS)

15. Most SNAP disqualifications from prosecution happened in California.

In 2016, there were 2,123 cases against people abusing welfare in the state, and the average fraud amount per disqualification was $3,033. California was also the state with the highest associated program loss of $6,439,059. It’s interesting to note, however, that other states had a much higher average fraud amount per case. SNAP fraud statistics reveal the lleaders in this category were Maryland ($69,873), Washington ($50,505), and New Hampshire ($49,905).

(FNS)

Frequently Asked Questions

How is welfare fraud detected?

Authorities first try to verify the citizenship and income of people suspected of welfare fraud. They work closely with state and federal agencies to collect all the necessary information. Reports show that more than 50% of states use Equifax services to get relevant and up-to-date data on welfare users.

Welfare fraud statistics and facts show that authorities often match the person’s against bank records to discover any hidden income or wages. In case they suspect a person is selling food stamps, they also check Electronic Benefit Transfer (EBT) records. These reveal suspicious activities like high-dollar amounts, even-dollar amounts, and out-of-state purchases. Only 1-1.5% of SNAP benefits are established as a fraud. Most food stamp abuse stories in the US are either SNAP trafficking or hiding incomes.

How long does food stamp investigation take?

Food stamp abuse facts reveal that every investigation length depends on multiple factors. Authorities first open and review the case and then complete interviews. The number of other ongoing investigations also affects the total investigation length. So, a food stamp investigation can take weeks, months, or even years.

What happens after you report welfare fraud?

The authorities receive your complaint and then send out a report to open an investigation. The welfare fraud investigator then opens and completes an investigation based on your allegations. Final conclusions and results are sent to the appropriate Welfare Office. If necessary, they are also sent to a prosecutor.

People who report frauds can choose to provide their personal information or stay anonymous. In any case, investigation status and report can never be disclosed. So, the person who reported the fraud shouldn’t hope for any updates. 

When filing a complaint, you must provide welfare abuse examples and proof, if any. Also, it’s mandatory to give the details of the person your complaint is about.

What does a welfare fraud investigator do?

They first check all state and federal records to collect relevant information about the person under investigation. They also investigate bank records and credit score reports. If necessary, they perform EBT checks too. Welfare fraud investigators also interview anyone they deem essential for the investigation.

Is welfare fraud a federal offense?

Both state and federal authorities can start an investigation on welfare fraud. Welfare fraud charges often come alongside charges of larceny, theft, forgery, and perjury. So, depending on the case severity as well as what agency conducts the investigation, welfare fraud may end up a federal issue.

What happens if you commit welfare fraud?

If the authorities conclude that you have committed welfare fraud, you must pay back any overpaid benefits. You may also receive a sentence. This can be community service, a penalty, probation, and even incarceration. Most likely, you will be temporarily or permanently banned from receiving public assistance benefits.

For SNAP, the first offense earns users a 12-month disqualification from the program. The second offense results in a 24-month disqualification, while the third one gets consumers a permanent ban. 

These fines and qualification periods may vary depending on the place of residence of the offender. Also, the penalties for retailers are different from those applicable to individuals — stores that commit fraud are liable to $10,000 in fines and/or an up to 5-year prison sentence.

How long can you stay on food stamps?

Americans with dependents under 18 or over 50 have no limit to how long they can receive SNAP. Single and healthy adults without any dependents are eligible for 3-month SNAP support within 36 months. There are some exceptions to this rule, depending on your living situation.

For example, residents of several destinations like Bois Forte, White Earth Reservations, and Red Lake can get SNAP longer. Also, those who participate in an approved employment program or receive cash assistance can get food stamps for more than three months. Pregnant Americans are eligible for longer support as well.

How much of my taxes goes to food stamps?

Only 6% of federal tax dollars go toward food stamps, child care, energy assistance, and other income security programs. The average SNAP contribution per American taxpayer is about $326. Unemployment and labor programs, in contrast, cost the average taxpayer about $1,010 a year.

Summary

All these welfare fraud statistics reveal that the general opinion on food stamps abuse is misguided. Even though welfare fraud and food stamps trafficking exist, their extent isn’t as broad as believed. Meaning, most SNAP funds reach Americans that genuinely need them, rather than being misused by welfare abusers.

References: AIC, NAO, NAO, SNAP To Health, USDA, FAS, FNS, YouGov