News Summary

Michigan lawmakers have proposed a new bill to combat fraud in the state’s food assistance program by requiring EBT cards to feature the cardholder’s photo and signature. The initiative, led by Rep. Jason Woolford, aims to curb increasing fraudulent activities linked to organized crime. Implementation costs are estimated between $1.5 million and $4.5 million annually, raising concerns over effectiveness and feasibility. Victims of EBT fraud are encouraged to report incidents promptly, as the state grapples with ongoing challenges in safeguarding food assistance benefits.

Lansing, Michigan – Michigan lawmakers have introduced a new proposal aimed at combatting fraud within the state’s food assistance program. Sponsored by Rep. Jason Woolford (R-Howell), House Bill 4515 seeks to amend the Social Welfare Act by requiring Bridge Cards—the electronic benefit transfer (EBT) cards used by those receiving food assistance—to display both the photograph and signature of the cardholder. This move is expected to address the alarming level of fraud affecting approximately 1.3 million Michiganders who rely on these benefits.

The primary motivation behind this legislation stems from reports of organized crime stealing EBT data to drain funds from the Supplemental Nutrition Assistance Program (SNAP). Woolford has described the individuals perpetrating this fraud as “sick and depraved.” The bill aims to add a layer of security that may help reduce the substantial fraud currently plaguing the system, which could theoretically save the state billions of dollars in lost benefits.

Implementation Costs and Concerns

Implementing the proposed photo and signature requirement is estimated to cost between $1.5 million and $4.5 million annually. However, the House Fiscal Agency has suggested that the actual savings from this fraud reduction may be minimal. Concerns have also been raised regarding the feasibility of the change, especially since federal regulations allow any household member with the correct PIN to utilize the EBT card, regardless of whose photo is printed on it. This limitation potentially undermines the effectiveness of the proposed amendment.

Rep. Mike Harris (R-Waterford Township) has expressed interest in determining whether existing images from Michigan’s ID database could be utilized for this proposal, thereby simplifying the process for recipients. Legislators are also wary of the added burden on food assistance recipients who would need to have a photo taken in order to comply with this new requirement.

Impact of Fraud on Michiganders

Fraudulent activities related to EBT cards have severe implications for vulnerable citizens. One single mother reported losing approximately $835 due to unauthorized transactions on her EBT card, which she discovered were conducted out-of-state. Alarmingly, over 97% of reported EBT cloning fraud cases are linked to out-of-state transactions. From October to May, the total value of replaced EBT benefits due to fraud summed up to $166,493, nearing the total for the entire fiscal year of 2023, which was $181,778.

Technological Challenges and Federal Support

Dwayne Haywood, Senior Director of the Economic Stability Administration for the Michigan Department of Health and Human Services (MDHHS), indicated that outdated technology contributes to the ongoing issues with EBT card fraud, as Michigan continues to utilize magnetic strip technology on its cards. In an effort to combat this alarming trend, MDHHS has received a $750,000 federal grant aimed at enhancing SNAP fraud prevention and detection efforts.

Victims of EBT card fraud are being urged to report incidents immediately to ensure their cards are canceled and to prevent further financial loss. This situation reflects broader challenges in statewide food assistance programs. In a related note, New York is experiencing its own struggles with fraud, having recorded 61,000 claims in just nine months, which has led to proposals for changes in their SNAP benefits system.

As Michigan lawmakers discuss potential solutions to these serious issues, the state continues to navigate the complexities surrounding food assistance fraud and its effects on those who depend on these crucial benefits.