Massachusetts gave millions of dollars in questionable public assistance to people who were listed as dead, used multiple Social Security numbers to boost their payments, or apparently sold their benefit cards for cash over the past few years, according to a state audit released Tuesday.
The report by State Auditor Suzanne Bump is the latest study finding that the state did not do nearly enough to ensure that welfare benefits went only to qualified recipients. The head of the agency that administers the aid quit in January after another scathing report from the inspector general.
Bump’s audit found that 1,160 recipients were either dead or used a deceased person’s Social Security number, costing $2.4 million between July 2010 and April 2012.
It also flagged another $15.6 million in suspicious transactions from electronic benefit cards between 2010 and 2012, including cards that were used as far away as Alaska, Hawaii, or the US Virgin Islands, suggesting the recipients either no longer lived in Massachusetts or had extra cash for travel.
Bump said that she thought the bulk of the $1.7 billion a year in welfare programs the state provides each year was probably spent properly, but she was disturbed that the state did not do more to investigate obvious signs of abuse or waste.
“It pains all of us in the auditor’s office to think that the program’s integrity is not being maintained,” Bump said. “The most frustrating finding is that we were able to identify so many patterns of activity that could have raised suspicions, but did not.”
Officials at the Department of Transitional Assistance, which provides aid to roughly one in seven people in the state, said the state made significant progress in addressing problems Bump raised, including matching recipient lists with information from agencies such as the Registry of Motor Vehicles or Department of Revenue.
“I am going to do whatever it takes to restore the credibility of the department and to make sure tax dollars are going to be used as intended,” said interim director Stacey Monahan. “One dollar in fraud is too much.”
Senate minority leader Bruce E. Tarr said the audit highlights the need for the state to do more to weed out fraud and waste. He said the Legislature should increase funding to the Department of Transitional Assistance, if needed.
“The system needs a lot more work,” said Tarr. “We cannot tolerate these kinds of gaps in the integrity of the system.”
On the other side of the aisle, House Speaker Robert A. DeLeo, a Winthrop Democrat, said in a statement that Bump’s audit “underscores the need for changes and reform.”
In July 2012, the agency told the state auditor that it was in the process of eliminating dead people from welfare rolls, including comparing its list of recipients to the Social Security Administration’s master list of dead people.
Yet a month later, in August 2012, the auditor’s office found a majority of dead recipients it checked were still receiving benefits, including many who started receiving aid for the first time after the beneficiary died. In some cases, family members continued to use benefit cards after relatives on public assistance passed away.
Monahan said the agency is waiting to receive from the auditor’s office the full list of people who supposedly received benefits after they died. She said the 178 names it has reviewed include a mix of beneficiaries who should have been cut off earlier, people whom the agency had already dropped, names that appeared more than once on the list, and people who were not dead after all.
Health and Human Services Secretary John Polanowicz, in a statement Tuesday night, said that of the 178 names, almost half were not dead and 17 involved people still receiving benefits on behalf of the deceased when the department got the audit. State officials said the department has subsequently closed those 17 cases.
Monahan said the agency was using the state’s database of deaths and started using the national Social Security database as well last year to help identify recipients who died.
Monahan’s predecessor, Daniel J. Curley, resigned shortly after Inspector General Glenn Cunha reported in January that the agency failed to verify recipients’ eligibility, potentially costing the state $25 million a year in unwarranted payments, and the US Department of Agriculture demanded the state repay $27 million in misdirected food benefits.
The state and federal government offer a variety of financial assistance to low-income households, including cash and food benefits typically loaded onto Electronic Benefits Transfer cards that work like debit cards. The cash can be withdrawn from automated teller machines or spent at retailers, while the food benefits are generally restricted to purchases for groceries.
Roughly 885,000 people received benefits from the state Department of Transitional Assistance last year.
Critics complained the state should have known long ago that welfare rolls were padded with people who have moved, died, or did not qualify.
Last year, when the agency mailed voter registration forms to nearly half a million households where someone had received public assistance, tens of thousands of the forms were returned as undeliverable, suggesting that the agency did not adequately track recipients to make sure they still lived in the state, let alone met other qualifications.
The latest audit spotted scores of other cases of apparent fraud, including 26 instances in which people used multiple Social Security numbers to get extra payments, 21 cases in which the same Social Security number was used by multiple people, and 40 cases when at least two people claimed the same person as a dependent.
In addition, the report found that millions of dollars in other suspicious transactions on electronic benefit cards including about $5 million in transactions in which all the money was spent at once; $4.6 million spent in distant states or territories; $3.6 million when recipients made multiple purchases or withdrawals within an hour; $1.5 million when recipients regularly rang up transactions in even dollar amounts (such as $100 or $200) and $840,000 when a card number was manually entered into a retail terminal instead of being swiped, suggesting a user may have stolen the card number but did not have the actual card.
In addition, the audit found many people repeatedly asked for duplicate benefit cards — including one person who received 127 cards — suggesting people were probably selling the food benefits stored on the card for cash.
Both Tarr, a Gloucester Republican, and Senate President Therese Murray, a Plymouth Democrat, praised Monahan, the interim director, for tackling many of the issues cited by the audit.
“Loopholes have been closed; action has been taken to enhance residency, address, and Social Security verifications; and improvements have been made to the system overall,” Murray said in a statement.
“There is always more work to be done, but these are promising steps toward significant and meaningful change.”
Todd Wallack can be reached at firstname.lastname@example.org.