The Office of the Utah State Auditor released A Performance Audit of Data Analytics Techniques to Detect Supplemental Nutrition Assistance Program (SNAP) Abuse.
SNAP is often referred to as “Food Stamps.” The audit report identifies four areas in which the Department of Workforce Services (DWS) could further improve oversight of SNAP by using data analytics to proactively identify and investigate potential misuse of SNAP funds. Over the past few years the Office shared opportunities for improvement within DWS which DWS management has been quick to implement. In this current analysis, the Office has identified opportunities to help prevent fraud or abuse of SNAP by focusing on analyzing available data. Specifically, DWS could use data analytics to identify SNAP recipients who:
-Make the majority of their purchases outside of the state.
-Request excessive electronic benefit transfer (EBT) cards.
-Attempt frequent rapid successive transactions.
-Make large or frequent even dollar transactions.
The audit report cites several cases in which a lack of proactive controls allowed potential program misuse to perpetuate. For example, 636 SNAP recipients made transactions exclusively outside of Utah for at least six months, calling into question their Utah SNAP eligibility. Some of these SNAP recipients claimed SNAP benefits from another state simultaneous to receiving SNAP benefits in Utah.
Another area where data analytics could help prevent SNAP abuse is proactively identifying cases in which recipients request excessive replacement cards. The Office identified multiple recipients who received an excessive number of replacement cards. A high number of replacement cards may indicate fraudulent use, such as selling or trading cards. As examples, one recipient received 22 replacement EBT cards and another received 24 replacements, both over an 18-month period.
In addition, analyzing the frequency of successive transactions, as is done in the commercial financial industry, can help flag SNAP recipients who may be selling or trading SNAP benefits, contrary to the program guidelines. The audit report discusses additional ways to use data analytics to proactively prevent SNAP misuse. The implementation of the recommendations found in this audit report will strengthen the administration of SNAP in the state while increasing recipient accountability. Proactively identifying program misuse will help ensure that SNAP benefits are used only for the intended purpose and by eligible individuals.