Welfare fraud

Welfare fraud is the illegal use of state welfare systems by knowingly withholding information or giving false or inaccurate information in order to obtain funds or obtain more funds than what the recipient is eligible for.

In the United States

The U.S. Department of Labor reported that 1.9% total UI payments for 2001 was attributable to fraud or abuse within the UI program.^[1] The Los Angeles Times reported in 2010 that twenty-four percent of new welfare applications in San Diego County contain some form of fraud which was determined to in fact include all forms of inaccuracy rather than just fraud.^[2]

Welfare fraud and abuse are not as high as one may think. In Florida, from July to Oct 2011, cash welfare recipients were drug tested, with advanced notice, and only 2.6% came back positive. Which means, 97.4% of recipients, who chose to partake in the testing program, were not using any kind of illegal or illicit drugs. Of the 2.6% that came back positive, most of the people came back positive for marijuana. Even the governor of Florida, Rick Scott eventually stopped pursuing people on welfare to get drug tested (Sherman).

Sherman, Amy. "Scott Abandons Promise to Drug Test Welfare Recipients." Http://www.politifact.com/. Http://www.politifact.com/, 10 Mar. 2015. Web. 7 Oct. 2015. <http://www.politifact.com/florida/promises/scott-o-meter/promise/600/require-drug-screening-for-welfare-recipients/>.

According to the U.S. Department of Labor statistics website, based on the 2012 IPIA three-Year average data report, fraud was prevalent in 2.67% of cases.^[3] XML and XLS Unemployment Insurance data sheets released yearly available at: www.dol.gov/dol/maps/Data.htm

Examples of US welfare fraud include:

• A 1977 claim by the executive director of the Illinois Legislative Advisory Committee on Public Aid, that a Chicago woman named Linda Taylor used 14 aliases to obtain $150,000 for medical assistance, cash assistance and bonus cash food stamps.^[4] She is believed to form the basis of U.S. President Ronald Reagan's "welfare queen", and was sentenced for two to six years.^[5]

• Dorothy Woods, of the U.S., who claimed 38 non-existent children.^[6] She was sentenced to eight years' jail.^[5]

• Esther Johnson of California, sentenced to four years in state prison in 1979 for "collecting $240,000 for more than 60 fictitious children".^[7]

• Arlene Otis of Cook County Illinois, indicted on 613 charges of "illegally receiving $150,839 in welfare funds between July 1972 and February 1978."^[8] She was sentenced to four years' jail.^[5]

In the United Kingdom

The United Kingdom Department for Work and Pensions (DWP) defines benefit fraud as when someone obtains state benefit they are not entitled to or deliberately fails to report a change in their personal circumstances. The DWP claim that fraudulent benefit claims amounted to around £900 million in 2008-09.^[9]

A UK State of the Nation report published in 2010 estimated the total benefit fraud in the United Kingdom in 2009/10 to be approximately £1 billion.^[10] Figures from the Department for Work and Pensions show that benefit fraud is thought to have cost taxpayers £1.2 billion during 2012-13, up 9 per cent on the year before. ^[11] A poll conducted by the Trades Union Congress in 2012 found that perceptions among the British public were that benefit fraud was high—on average people thought that 27% of the British welfare budget is claimed fraudulently;^[12] however, official UK Government figures have stated that the proportion of fraud stands at 0.7% of the total welfare budget in 2011/12.^[13]

In Japan

In 2010, a Tokyo family was suspected of fraud after claiming pensions for a man for 30 years after his alleged death. His 'skeletal remains' were found still in the family home.^[14]

See also

• Medicare fraud
• Criticisms of welfare

References

1. "Committee on Ways and Means, Subcommittee on Human Resources, 6-11-02 Testimony". Waysandmeans.house.gov. Retrieved 2012-03-14.
2. "Fact Check: The Frequency of Welfare Fraud - voiceofsandiego.org: San Diego Fact Check". voiceofsandiego.org. 2010-11-10. Retrieved 2012-03-14.
3. "Unemployment Insurance (UI) Improper Payments By State". Retrieved 2013-09-12.
4. Associated Press, Mar. 8, 1977, AM cycle, Chicago (available on LEXIS)
5. Spamlaws.com Welfare fraud examples
6. "Woman's Aid Claims for 38 children Are Examined". The New York Times. December 21, 1980. p. 31.
7. Associated Press, June 13, 1979, AM cycle, Compton, CA (available on LEXIS)
8. "Woman Faces 613 Counts Of Welfare Fraud". Observer-Reporter. Associated Press. May 9, 1978.
9. Reporting benefit fraud at Directgov
10. "State of the nation report: poverty, worklessness and welfare dependency in the UK" (PDF). HM Government. May 2010. p. 34. Retrieved 5 January 2013. Figures quoted as distinct from costs related to error
11. Dixon, Hayley (13 December 2013). "Majority of benefit cheats not prosecuted, official figures show". The Telegraph. Retrieved 24 February 2014.
12. "Support for benefit cuts dependent on ignorance, TUC-commissioned poll finds". TUC. Retrieved 5 January 2013.
13. "Fraud and Error Preliminary 2011/12 Estimates". Fraud and Error in the Benefit System: Preliminary 2011/12 Estimates (Great Britain) Revised Edition. Department for Work and Pensions. 6 June 2012. p. 2.
14. "Tokyo's 'oldest man' had been dead for 30 years". BBC News. 2010-07-29. Retrieved 15 January 2013.