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Food Stamp Trafficking Up 30% From 2008 to 2011

Food stamp trafficking a record $858M in 2011

7:58 AM, Aug 16, 2013 • By JERYL BIER
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The U.S. Department of Agriculture (USDA) released a report on Thursday regarding illegal trafficking in the Supplemental Nutrition Assistance Program (SNAP), more commonly known as food stamps. The report showed that the rate of trafficking rose from 1 percent of total benefits in the last study period of 2006-2008 to 1.3 percent in the current study period of 2009-2011, an increase of 30 percent. The report noted the trafficking rate remains well below a rate of almost 4 percent that existed for much of the 1990s. The rate plunged to 1 percent by the 2002-2005 study period and remained there until the current report:

While the rate, as a percentage, remains relatively low, the sharp increase in the SNAP program means the total annualized dollar amount of fraud reached a record level of $858 million, exceeding the $811 million from 1993.  This value had been dropping dramatically to a low of $241 for 2002-2005, then ticked up to $330 million in 2006-2008, before exploding in the current report to $858 million.

The report attributes much of the dollar increase to the growth in SNAP.  Total redemptions more than doubled from 2008 to 2011:

A substantial portion of this increase is due to the growth in the program, where redemptions totaled $36 billion in 2008 (the last year of the previous study period), then increased to $55 billion in 2009 (the first year of present study period) and eventually to $73 billion in 2011.

The latest figures show that SNAP redemptions rose again in 2012 to $74.6 billion.

The USDA study also found that the percentage of authorized SNAP stores engaging in trafficking went from 8.2 percent in 2006-2008 to 10.5 percent in 2009-2011, a 28 percent increase, but still not as high as an 11.7 percent rate in the 1990s.

Although food stamp trafficking is illegal, the report notes that:

trafficking does not increase costs to the Federal Government, it is a diversion of program benefits from their intended purpose of helping low-income families access a nutritious diet.

In conjunction with the release of the report, the USDA announced "Additional Measures to Improve Integrity in the Supplemental Nutrition Assistance Program."

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