Cheating the Food Assistance System

KALAMAZOO (Newschannel 3) - Many people in Michigan have come upon hard times, and depend on food stamps to feed their families.

But what about those who abuse the system? Newschannel 3 caught a few of those people in the act, taking advantage of the program made possible by your tax money.

In Kalamazoo County alone, the number of people using food stamps is up 33 percent from 2007. But while some pinch pennies and stretch every last dime to put food on the table, you might be surprised to see what we found going on inside a kalamazoo grocery store.

And if anyone knows the value of a dime, it would be Tawnya Raab. She's been using food stamps for almost a year now, in order to feed her son Nicholas.

"I'll actually plan out a whole menu: breakfast, lunch, and dinner for two whole weeks," she told Newschannel 3.

But Tawnya and her son are just two of a growing number needing food assistance in a struggling economy, joining 1.2 million others right here in Michigan, and last month alone, there were 31,000 in Kalamazoo.

Yet as the need grows, lurking in the background is a consistent problem, one which you may have even witnessed in the grocery store.

It's a plot to cheat the system, when food stamp users spend their stamps on box upon box of sale soda pop, but then dump out the soda, return the cans, and use the return to buy alcohol or other controlled substances. Grocery managers and security guards in Kalamazoo say they see it all the time.

So why don't the food stamp users just buy what they really want in the first place? Because the system comes with rules.

"You cannot buy alcohol and you cannot buy cigarettes," said Don Mussen with the Department of Human Services.

So those who are desperate have found another way - by cheating the system - and lighting up or getting drunk off your dollar.

"It happens every day, definitely," said a Hardings Grocery store security guard, who did not want to be identified.

So Newschannel 3 decided to see for ourselves - and we didn't have to wait long - to see two men coming out of Hardings with boxes of Faygo pop placed into their cart. First, one man buys the loot and heads outside the store. Second, he and his partner dump out can after can of soda, just around the corner from the store. Finally, the second man takes a trash bag out from his backpack, piles in the empty cans, and heads back inside to redeem the deposit.

"And what does he buy with his new found cash? Cigarettes, for him and his partner to enjoy right in front of the building," said the security guard.

Hearing about the waste of perfectly good soda is just about all Tawnya Raab can handle, because it's a waste of what she and her son consider a rare, extra treat.

"It just burns me up inside," she said.

Newschannel 3 caught up with Raymond Taetsch, who works for the Office of the Inspector General in Lansing, and asked him about the legality of what a growing number of food stamp users are doing. He says that over the last fiscal year, his office investigated 5,800 food assistance fraud cases, but none were for what Newschannel 3 caught on camera.

"It's unfortunate, but it's not illegal at this time," said Taetsch.

And that shocks Raab, who doesn't understand how the system could ignore such a large loophole.

"What do you mean its not illegal?" she said. "It's still fraud use of food stamps isn't it? Doesn't it qualify? Wow."

While many feel that something needs to be done to control what people purchase because of those who are manipulating the system, food stamps are a federal program, and federally, there are no laws against it, so state investigators' hands are tied.

"I'm sad that that's happening. As a taxpayer I'm concerned about that too," said Taetsch. "There's nothing we can do from a criminal standpoint."

"Right now lawmakers in Washington are considering making the practice illegal. It's part of the Farm Bill, where the Senate version would disqualify food stamp users who destroy food for cash. A decision is not expected on that for a few weeks.

Gov. Granholm is also considering legislation that would change the way food stamps are distributed in Michigan. Recipients would get the same amount of money, but in two payments per month instead of all at once. Those bills are currently on the Governor's desk.