Expert: Ohio could lose $320 million to SNAP fraud

Skimmers, scammers active in Greater Cincinnati
Posted at 7:00 PM, May 24, 2023
and last updated 2023-05-24 19:44:44-04

CINCINNATI — Hamilton County fraud investigators are getting 20 calls a day from people who say their food stamps were stolen by scammers.

It’s part of a national trend in which thieves are using skimmers and debit-card cloning machines to raid electronic benefit accounts in the Supplemental Nutrition Assistance Program, or SNAP. While Congress has ordered states to reimburse theft losses, Ohio and Indiana won’t take applications before July 1. Kentucky has yet to set a launch date.

“We started hearing about it in September of last year and at that time we were getting maybe seven calls a week. Since the beginning of the year, it has just started to grow,” said Edward Feldkamp, manager of fraud investigations for the Hamilton County Department of Job & Family Services. “It was very discouraging during the holiday season, where people were going to the grocery store to try to get Christmas dinner and things like that. And their benefits were gone. It was very sad.”

Ed Feldkamp tells SNAP recipients to change their PINs frequently.

Hamilton County has forwarded about 300 cases to state officials, with theft amounts ranging from $75 to $1,500 per case, Feldkamp said. Ohio has so far identified about 1,900 transactions statewide totaling $775,000 in theft, said Bill Teets, Ohio JFS spokesman.

Ohio’s theft losses could grow to more than $300 million in the SNAP program, according to a new analysis by Haywood Talcove, CEO of the government division at LexisNexis Risk Solutions. Talcove looked at several data points to arrive at his estimate, including 250,000 police reports on SNAP benefit thefts nationwide and a 5,000 percent increase in the number of EBT cards available on the dark web.

“If I wanted to, I could go out today and buy hundreds of cards from the state of Ohio,” Talcove said. “The average person has about $600 on that card. And I could get that card for $100 bucks.”

Other factors include Ohio’s lack of chip-enabled cards and the $1.6 billion in benefits it pays to SNAP recipients.

“The fundamental problem with SNAP is that they’re using technology from the 1970s,” Talcove said. “They’re using processes from the 1960s. And they have a program that spends approximately 157 billion annually, using technology that a 9-year-old can bypass.”

That criticism worries Finneytown resident Courtney Campbell, who applied for SNAP benefits after taking custody of two nieces recently.

“Food, clothes, all that is very important for kids,” she said. “So, to know that things are being misused and taken from us without our knowledge is kind of hurtful, deceiving.”

While she hasn’t been targeted by thieves in the SNAP program, she was the victim of identity theft in 2018. It cost her $3,000 and took weeks to resolve. So, she doesn’t want to repeat the experience.

“They thought that I was not Courtney,” she said. “I had to have my family come up there and prove, bring all my identification and social security. It was a process.”

In December, Congress required states to develop programs for reimbursing SNAP recipients for benefits lost to skimming or cloning. Ohio’s program is expected to launch July 31 with an application process that requires recipients to show the alleged theft happened in the 12 months after October 1, 2023.

Ohio will notify SNAP recipients about the application process via text, robocalls and social media campaigns. Recipients will have 90 days to submit a “replacement request” and will have the opportunity to appeal if the state rejects the application, according to Ohio’s plan for replacing stolen benefits.

In the meantime, it urges SNAP recipients to do the following:

  • Change your PIN monthly, before each scheduled benefit deposit.
  • You may want to change your PIN after making an online purchase using an EBT or cash card and PIN.
  • Never share the EBT or cash card number or PIN if asked for through an email, text message, or over the phone.
  • Carefully look at any card reader before using your card: Skimming devices can be placed over the card reader. Check if a reader sticks out or doesn’t seem secure.
  • When using your card, cover the keypad with your body or hand to stop someone from seeing your PIN. Scammers sometimes try to get your PIN by watching from a distance.