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What you need to know for 11/18/2017

Welfare fraud crackdown underway in Montgomery County

Welfare fraud crackdown underway in Montgomery County

A restructured Fraud Unit has early successes
Welfare fraud crackdown underway in Montgomery County
Montgomery County Executive Matthew Ossenfort speaks during an event at Amsterdam City Hall in January 2016.
Photographer: Daily Gazette file photo

Montgomery County officials have launched a fresh effort to combat welfare fraud.

County Executive Matthew Ossenfort recently proclaimed a “zero tolerance” approach toward those who claim benefits to which they are not entitled. 

The centerpiece of the initiative is a restructuring of the Fraud Unit within the county’s Department of Social Services. The unit previously consisted of six part-time fraud investigators. Now, it comprises three part-time investigators, a full-time supervisor and a social welfare examiner. 

A social welfare examiner reviews welfare applications to determine applicants' eligibility for benefits. The fraud investigators are usually current or former members of law enforcement who gather evidence of fraud when it is suspected. 

Ossenfort said the shakeup was a couple of years in the making and came out of a desire for county agencies to be more efficient stewards of taxpayer funds. He said the problem is of particular concern in rural counties across New York. 

“One of the issues we have in this county is the dependence on these programs has become almost generational. Younger people are learning it from family members,” Ossenfort said  “For those that rightly need it, that’s who the programs are there for. But when you have those who know how to manipulate the system, I think that’s what you’re seeing here.” 

The new team's efforts appear to be effective. In March, the Fraud Unit, with help from local law enforcement, made six arrests related to welfare fraud. In February, they made seven arrests. Under the old unit’s structure, there were an average of 6-12 arrests per quarter, according to county DSS Commissioner Michael McMahon. 

“I think it’s probably similar to other counties,” McMahon said of fraud in Montgomery County. “Fraud is just something that happens. The vast majority of individuals that require services do it honestly, but there are other ones that are going to defraud the system.”

Services like the federal government’s Supplemental Nutrition Assistance Program (food stamps) are fertile ground for fraud, said McMahon, as well as other federal programs like public assistance for rent and utility bills. Often a person will claim to have more dependents than they actually have, or they will have an off-the-books job that pays in cash. 

Fraud cases are sent to the Montgomery County District Attorney’s Office, which confers with DSS on what charges should be brought. A common charge, said McMahon, is offering a false instrument for filing, which is a felony. There is also a charge simply known as “welfare fraud,” a misdemeanor.

Once charges are drawn up, warrants are typically issued through local law enforcement agencies. 

The city of Amsterdam Police Department handles arrests in the city, while the Montgomery County Sheriff’s Office is used for other areas of the county. McMahon said those accused of fraud are notified to turn themselves in, which the majority of them do, and are usually offered an opportunity to avoid jail time in exchange for repaying the benefits they stole.

“I think the county would rather gain the money back than to pursue a case,” he said. “Having somebody sit in jail doesn’t do the taxpayer any good.” 

McMahon said the average amount stolen in such cases ranges from $500 to $10,000, depending on how long the fraud went undetected. He doesn’t know exactly how much the county has saved since the fraud unit was restructured, but he said the department’s internal detection system this year alone rooted out $411,000 worth of fraudulent applications. 

And while the case could be made that welfare fraud in the county amounts to stealing mostly federal funds, McMahon said the public’s faith in the system is important, and that fraud can prevent someone who really needs benefits from obtaining them.

“There’s only X amount of dollars in the system, so if you’re losing 20 percent of it to fraud, there’s less for someone [who needs it],” he said. “I think we want to make sure our system has integrity. It hurts taxpayers when we don’t go after [fraud].”

There are also programs administered by DSS that are mostly county-funded. McMahon said fraud is common in a program called Safety Net, which is 71 percent county-funded and provides assistance for singles without dependents, childless couples or families that have been on assistance for more than 60 months. 

Ossenfort said local governments have no say in what benefits individuals or families are entitled to, but those governments can take steps to ensure there’s as little fraud as possible. 

“You can’t control what the mandates are coming down or the ratio of what reimbursements are, but the one thing we can have full control of is making sure there aren’t folks who are abusing the system,” he said. 

Montgomery County DA Kelli McCoski, who took office in January, said her office is a fully invested partner in the crackdown to prevent welfare fraud. She said some cases do go to trial and are prosecuted under the office’s only full-time assistant district attorney, Peter Califano. 

“We’ve taken a very hard line on this because it’s not our money to play with,” said McCoski. “I hope that through the newspapers and word-of- mouth and social media, that people in Montgomery County understand that if they commit welfare fraud or abuse, that it’s going to get prosecuted very vigorously, and they should probably spread the word.”

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