Federal authorities indicted 22 people this week in what U.S. attorney Wifredo Ferrer described as “the largest food stamp fraud take-down in U.S. history.”
The bust, dubbed “Operation Stampede,” looked at a large organization of produce vendors at the Opa Locka Flea Market in Hialeah, Florida. Authorities say they swiped electronic-benefit cards, often without actually selling food, converting the benefits into cash that they and the cardholders then pocketed.
In doing so, they stole at least $13 million, authorities say.
Video footage from the bust shows federal agents and police storming the flea market, guns drawn, swarming between produce stands. A sign over at least one stand advertises, “We accept food stamps.”
The video, posted on YouTube by the Palm Beach Sherriff’s Office, also shows produce stands fenced off by crime-scene tape, handfuls of electronic-benefit cards, and the arrests of several suspects.
Local authorities unearthed the alleged fraud scheme as they investigated an suspect they believed had stolen more than 500 identities, using them to acquire food-stamp and electronic-benefit cards from the federal government.
The investigation, which is ongoing, will next focus on welfare beneficiaries who went to the Opa Locka Flea Market with their cards, fraudulently selling their benefits to the vendors, said the Florida Department of Children and Families.
Though this bust is the biggest ever, food-stamp trafficking is a growing problem nationwide. The Department of Agriculture’s most recent report on the issue, published in 2013, found that the rates of trafficking had increased 30% since their last study, which covered 2006 through 2008.
As more people signed up for food stamps under the Obama administration, the value of trafficked benefits also grew substantially — $858 million annually, up from just $330 million during the 2006-2008 study.
The Government Accountability Office has cautioned that as state budgets contract, law enforcement and prosecutors have often scaled back on benefits-fraud cases.
But even when state authorities are proactive cracking down on fraudsters, they sometimes face opposition from an unlikely source: the federal government.
Maine, which has taken the most aggressive approach to welfare fraud, brought a record-breaking 105 cases for prosecution last year alone — up from zero in 2009. The state claims to have uncovered more than $1.2 million in fraudulently obtained benefits.
But the Obama administration has attacked several measures taken by Maine to reduce fraud. For instance, when the state began a voluntary pilot program in 2014 to put photo identification on benefits cards — but the USDA demanded Maine pause the program and file extensive paperwork.
The USDA has also repeatedly threatened to pull federal funding from Maine over its welfare-reform efforts, even threatening litigation.
— Jillian Kay Melchior writes for Heat Street and is a fellow for the Steamboat Institute and Independent Women’s Forum.