I-Team food stamp investigation gets national attention

WASHINGTON - An I-Team investigation into food stamp fraud received national attention on Capitol Hill Thursday night.

Members of the House Committee on Oversight and Government Reform held a hearing to question officials who oversee the nation's food stamp program.

The hearing started with what Scripps Howard News Service exposed in an ongoing investigation on food stamp fraud in the nation.

"What whistleblowers have done for us could have prevented many of those stores from being back in business," said California Rep. Darrell Issa (R).

The meeting followed with almost two hours of tough questioning.

"These retailers have violated the law, and we don't debar them, then shame on us. Anyone want to respond to that?" said Rep. Jackie Speier (D) of California.

Kevin Concannon, the head of the U.S. Department of Agriculture's Supplemental Nutrition Assistance Program or SNAP, attempted to explain why disqualified vendors still accept food stamps, even after the USDA busts them for fraud -- some as many as four times.

"While a vast majority of retailers follow the rules, a few bad actors will always seek to exploit SNAP," said Conncannon.

But, Concannon's own inspector general, the USDA's Phyllis Fong, testified that more could be done.

"USDA has implemented regulations, and as a whole, the department could do a better job at implementing that," Fong said.

Food stamp scams cost taxpayers hundreds of millions of dollars each year. Store clerks secretly ring up a case of beer as a box of cereal or charge $100 on the card and give $50 in return.

Repeatedly gaming the system for cash means recipients are even buying big-ticket items.

"It's critical that we focus our efforts on retailers who bypass the system that we put in place to control access," said Fong.

That's why the government permanently bans about a thousand retailers nationwide for fraud every year. But the Scripps investigation revealed nearly a third of the disqualified sites were approved to trade in food stamps again.

"Scripps Howard exposed fraud you were not aware of, correct?" asked Issa.

"Correct," answered Concannon.

The USDA says they're now doing more to combat fraud. That means stricter rules and stiffer penalties. But that's not enough for chairman Issa.

"The next analysis on the level of waste has to be one that's independent from the USDA," said Issa.

In Thursday's testimony, Concannon disputed what the Scripps investigation exposed.

"Our results show that the issues may not be as widespread as first reported by Scripps," said Concannon.

After the hearing, a reporter for Scripps tried to get the undersecretary to explain the discrepancies, but he and his staff couldn't give an answer.

"You made your mistakes, and you're unwilling to admit it," said Concannon.

Neither Concannon nor his staff ever contacted Scripps to correct the reports.

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