What Will Happen If Someone is Found Guilty on Welfare Fraud?

By Eileen Baylus - Updated June 16, 2017

A person who is found guilty of welfare fraud faces criminal conviction, fines, penalties, restitution and disqualification from the welfare program. Fraud occurs whenever a person receives benefits he or she is not entitled to by lying about eligibility. This lying takes the form of deliberate misstatements of facts, or failure to reveal information that would help the government determine a person’s eligibility for welfare benefits. Welfare benefits include food stamps, medical assistance and housing vouchers.


The punishment for welfare fraud varies from state to state. The fraudulent party has to repay the amount falsely received as well as fines and interest charges. Punishment for welfare fraud can be as mild as losing welfare benefits for a period of time, or can include large fines and time in prison. If the welfare fraud has been going on for several years, every state includes a prison term in the punishment. Penalties are more severe if there is a pattern of fraud. For example, in Nevada, if a person misrepresents her identity or place of residence in an attempt to secure multiple benefits at the same time, she will be disqualified from participation in that program for 10 years. The penalty applies even if the household does not actually receive multiple benefits.

Fraud Investigation

A person who receives welfare benefits is monitored by the state to see if anything has changed. A fraud investigator visits the home if the welfare office believes someone is not being truthful. If, for example, you lied about the income you earned, the investigator may suggest you lose your benefits and charge you with overpayment of the benefits you should not have received. You then need to repay that amount. If you lied to get benefits you are not entitled to, the welfare office can refer you to prosecution.

Reporting Fraud

Most jurisdictions have investigators and welfare fraud hotlines for people to anonymously report suspected fraud. But there is no national registry to report fraud. To locate your regional office, look for the listing of local social services headquarters for your state.

Recognizing Welfare Fraud

Welfare fraud includes things such as failing to report income and assets, as well as failure to disclose a change in employment, marital status or child support payments. Using a fake identity to obtain welfare benefits or to file for benefits under several names is also fraud. Receiving welfare benefits from several states simultaneously is welfare fraud.

About the Author

Eileen Baylus has worked in the publishing field since the 1980s. After graduating with a Bachelor of Science from Towson University in mass communications, she has spent time as a writer for local newspapers, a proofreader for journals and an editor for book publishers.

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