Growing Epidemic Of Welfare Fraud That Has Tax Payers FURIOUS! (Video)



People are defrauding the government by purchasing large quantities of soda for the intent of resale to other business owners for cash. It’s happening all over the United States, but one particular investigation in Hazard, KY has put many in jail and around a dozen indicted. They are using part of a $1.1 million federal grant to go undercover to bust the offenders.

In February 2014, WKYT Investigates first spotlighted the scheme where food stamp or Supplemental Nutrition Assistance Program recipients use their benefits to buy soda in bulk and then re-sell them for cash. The United States Department of Agriculture, the federal agency that oversees food stamps, considers the scheme trafficking but says the enforcement of rules falls to the state. Using WKYT’s story highlighting the “pop train” to plea its case, Kentucky’s Cabinet for Health and Family Services received a federal grant to battle the fraud last October. Kentucky, which was one of only seven states to receive grant money, gave some of the grant to the Hazard Police Department.

“The benefits are not being used for what they are intended for which is to feed their families,” Hazard Police Chief Minor Allen said. “It’s just become an expected practice in some places.” So far, Hazard police have arrested and indicted close to a dozen people for welfare fraud. The cases of soda seized as part of those investigations are now piled in the department’s evidence room. The “pop train” is most visible during the first part of the month as food stamp benefits are dispersed.

“This is something new for us, as far as law enforcement,” explained Hazard Police Detective Paul Campbell as crews worked to derail the scheme. “There’s a lot of rumors floating around about it. ‘Is this illegal? Why are police investigating this?’” “They know if they’re buying a 12 pack of Pepsi for $2.50 off of some guy that pulls up in the parking lot, that’s shady,” said Campbell who questions the stores that buy the soda off welfare recipients. Campbell showed WKYT how detectives wait outside stores for customers to roll out numerous packages of soda out the door. Detectives then follow the customers to see if they make a sell.

“This comes out of our tax money. It’s not right. It’s not fair. When people go inside here and purchase whatever they want and then resell it with the intent to defraud the government, that’s not right,” Campbell said.

The Cabinet for Health and Family Services says it bans the selling of food items purchased with SNAP benefit, and they continue to work with local offices to ensure they understand the policy. If you see this happening and want to report it, call the Cabinet for Health and Family Services at 1-800-372-2970.

The biggest problem with the system we have is there are no checks and balances to combat fraud. The pop thing is just one example in that it has been going on for years and is just now being noticed. If that is ever corrected you can be sure another scam will arise which will also go unnoticed for years. The problem is the people who abuse the system and have no self respect are ruining things for the people who really need the assitance. Again, I cannot emphasize enough, the need to think before we react. If we just react we will inevitably hurt the people who need help and the ones who are committing fraud will just move on to another scam. I would suggest that the people who are buying the pop be criminally charged with fraud, conspiracy to commit fraud, (or other related charges) and given hefty fines, jail time, or whatever. This will make store owners think twice before they buy pop or other food items from sources other then the legitimate ones they are supposed to buy from.

For example, in New Mexico it is not pop but candy that is being bought and sold by food stamp recipients. In other states I’m sure there are other food items that are being used in the fraud. This is not an isolated situation here, the fraud is being perpetrated all over the US, not just KY. 

Here’s the video report!



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