Probers uncover record $13.7 million in welfare fraud

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BOSTON – State welfare fraud investigators uncovered a record $13.7 million in bogus claims in fiscal 2015, according to state Auditor Suzanne Bump.

The amount was up 44 percent from the previous year, Bump told the Legislature’s Joint Ways and Means Committee on Tuesday. She said her office’s Bureau of Special Investigations will release the details in its 2015 annual report Wednesday.

“By dollar volume, the largest amount comes from MassHealth fraud. In that case it’s mostly individuals who were getting benefits for which they really were not eligible because they’ve been hiding income,” Bump said. “In other cases, I think the next largest is in the SNAP program, that is the food-stamp program, and there we see a combination of individuals who again typically are claiming benefits when they have other sources of household income.”

The auditor said the bureau used data analytics to identify fraud rings that are operating with the cooperation of merchants. The data analytics unit of the bureau, which Bump said has a budget of less than half a million dollars, identified $4.1 million in fraud, which she described as a roughly 9 to 1 return on investment.

During fiscal 2015, which ended last June 30, the state spent more than $13 billion on the application and administration of public benefits, largely within MassHealth and the Department of Transitional Assistance.

While she did not estimate an overall level of fraud involving state benefits, Bump said the record dollar amount of fraud identified does not necessarily indicate a record level of fraud in the state’s public assistance programs.

“If I might anticipate the question that will naturally flow from this, the answer is, no, it doesn’t mean there is 44 percent more fraud taking place,” Bump said. “We are identifying ever-larger amounts of fraud because we are working smarter. We have improved our relationships with the agencies that provide benefits and … we have invested in technology and staff that enable us to analyze tremendous amounts of data, discern potential patterns of fraud, and act proactively and rapidly.”

Now that the fraud has been identified, it is up to the agencies that refer possible cases of fraud to the auditor’s office to try to recover some of the $13.7 million.

“It does not all get recovered, though, I can tell you that,” Bump said.

Written by Colin A. Young