Welfare fraud may take the form of deliberate misstatements of facts or a failure to reveal information that would help the government determine the individual’s actual eligibility for welfare benefits. A conviction on a charge of welfare fraud carries a number of legal and practical consequences, ranging from disqualification and removal from the welfare program to the assessment of stiff fines and restitution, in addition to a possible prison sentence.
Legal Basis of Welfare Fraud Crimes
Welfare benefits include several distinct programs at both the federal and state levels. Some of the more well-known forms are the federal food stamps program (Supplemental Nutrition Assistance Program, or SNAP), the Aid to Families with Dependent Children program (AFDC), medical assistance, housing vouchers, and other forms of public assistance and welfare. In most cases, states administer these programs through a grant and federal authority, but via state employees.
Welfare programs are created and administered through various statutory provisions. These statutes generally include a provision that criminalizes making false statements or withholding material information in pursuit of benefits. For example, section 608a of Title 42, which covers fraudulent actions in pursuit of benefits under the Temporary Assistance to Needy Families and related programs, such as SNAP, bars such applicants and recipients from receiving additional benefits under any federally-funded welfare program.
Read More: Where to Report Welfare Fraud in BC
Specific Types of Welfare Fraud
Welfare fraud is a broad umbrella term that encompasses a number of types of acts and omissions. It includes specific and material misrepresentations, such as underreporting income or omitting valuable assets in order to meet welfare qualifications. It can also include other types of omissions, such as a failure to mention a separate, reportable income source.
In addition to fraudulent statements on an initial application, fraud may also include acts and omissions that take place after welfare applications are approved. Even if an individual recipient has been receiving benefits lawfully for years, a lie or failure to report a significant change in circumstances may support a conviction for welfare fraud. Changes in employment, marital status or child support payments must be reported, and a failure to do so may be deemed fraud.
Another common example of fraud is using a fake identity to obtain welfare benefits or to file for benefits under several names. Additionally, applying for or receiving welfare benefits from several states simultaneously will support a criminal charge of welfare fraud.
Restitution of Improperly Received Benefits
The punishment for welfare fraud varies from state to state. One commonly assessed penalty is restitution, in which the person committing the fraud must repay a specific amount of money to authorities or to the agency administering the welfare program in question. Restitution may include both the amount that was falsely received as well as fines and interest charges going back to the date of the first illegally received benefits or payment.
Fines and Imprisonment
While some applicants and recipients who are convicted of welfare fraud face relatively mild consequences, such as the loss of benefits for a specific period of time, more significant penalties may be assessed in other cases. Those penalties can include large fines and lengthy prison sentences. When the fraud has been perpetrated for several years, prison terms are among the major penalties imposed by courts after a conviction. Additionally, courts tend to impose harsher penalties in situations in which the person is proven to have engaged in a pattern of fraud.
As an example, Nevada law states that when an applicant tries to secure benefits under multiple identities through misrepresentations of his name or residence, that person is disqualified from participation in the program for 10 years. The penalty applies even if the household only attempts to secure multiple benefits but does not actually receive them. Those convicted of welfare fraud in Nevada may also face imprisonment for up to four years and up to $5,000 in fines.
Statute of Limitations for Welfare Fraud
For many criminal cases, prosecutors must bring charges within a specific period of time. That period of time is known as the statute of limitations. Each state chooses its own statute of limitations period for welfare fraud charges. A five-year statutory period is not uncommon. That period of time typically begins to run from the date the fraud was discovered (as opposed to the date the fraud occurred).
As with most statutes of limitations, the period in which welfare fraud charges must be brought may be paused, or tolled, if the defendant leaves the jurisdiction (the state). For example, if the welfare fraud is discovered in 2010, the statute of limitations is five years and the defendant leaves the state between 2012 and 2019, the statutory period expires in 2022, not 2015.
- Washington State Department of Social and Health Services: What is Welfare Fraud in Washington State?
- Washington Law Help: Welfare Fraud: What You Need to Know
- Benefits.Gov: Supplemental Nutrition Assistance Program (SNAP
- National Federal Defense Lawyer Group: Welfare Fraud Laws, Charges & Statute of Limitations
- Legal Information Institute: U.S. Code - 42 U.S. Code § 608a. Fraud under means-tested welfare and public assistance programs
- Shouse Law Group: Nevada "Welfare Fraud" Law (NRS 422A.700)