Criminal Welfare Theft Enterprise Costing Massachusetts Taxpayers

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By Chris Lisinski
State House News Service

The state’s public benefits system has seen a dramatic increase in demand over the past five years, and now overseers are also contending with what one official described as an “outrageous” surge in illegal benefit skimming.

Massachusetts Department of Transitional Assistance commissioner Jeff McCue and his team have spent the past several months attempting to limit the impacts of a “fairly sophisticated crime syndicate,” which has been stealing from Bay Staters who receive cash aid benefits, he told lawmakers Tuesday.

McCue said bad actors are able to obtain private information for welfare clients, then wait until they receive their benefits and “swoop in.” He described the trend as “consistent with some of the benefit thefts that were seen during the height of the pandemic.”

“This is not a small-time crooked enterprise that’s based out of some locality anywhere in the commonwealth,” McCue said during a hearing Tuesday, March 12 of the state legislature’s Joint Ways and Means Committee in Springfield. “This is a very sophisticated group that comes in that effectively steals data, keeps it on the dark web, and then one day decides to drop it down and deploy it, and effectively does so by preying on the most vulnerable individuals in the commonwealth.”

State officials are trying to mitigate the problem through expanded outreach to welfare clients and community partners. Earlier in March, recipients received text messages from the department one day before their benefits were delivered, encouraging them to change their personal identification numbers as a precaution.

“Quite honestly, I hate playing defense on this,” McCue said. “What we’re trying to do is to play offense.”

The department’s response led to a “significant reduction” in skimming comparing March to February, McCue said, but he stressed that Massachusetts needs “a national response.”

When Congress takes up a farm bill in the next few months, he hopes federal lawmakers invest in technology that will better safeguard public benefits available through electronic benefit transfer cards, McCue said.

The Massachusetts Department of Transitional Assistance, the state agency that handles welfare payments, is also one of the agencies in five states selected to pilot a mobile payment method, starting in late 2025, that will allow recipients to use an electronic version of their EBT card stored in a virtual wallet.

In the past, the state Department of Transitional Assistance typically provided replacement benefits for any that were stolen in about five days. Lately, McCue said, the department has been unable to match that timeframe “given the crush that happened in February.”

His presentation left at least one lawmaker vocally gobsmacked.

“I’m riveted by what you’re — I’m almost forgetting my question. That is shocking,” said state Representative Sally Kerans (D-Danvers) following McCue’s testimony. “I’m glad to hear that you’re a step ahead and that just changing the PIN can help. I assume the FBI is involved in investigating.”

McCue replied that the problem has been flagged for the Federal Bureau of Investigation,, the U.S. Department of Justice, the state attorney general, and “a number of groups.”

“Usually, what we’re able to identify locally is an individual that’s very low down the chain, and we’re not able to necessarily navigate up through them to get some of the folks that might be higher up,” McCue said. “This is really a federal piece.”

McCue did not assign a total value to the benefits stolen or skimmed to date.

It’s not the first time that state officials have warned about a rise in fraud targeting Bay Staters receiving public benefits. Department leaders lodged a similar warning at last year’s budget hearing, and benefit fraud was a common problem early in the COVID-19 pandemic.

The latest upheaval hits as the department continues to navigate a steady increase in demand for the financial assistance it offers to some of the state’s lowest-income, most vulnerable residents.

Demand did not taper off once the COVID-19 state of emergency ended. Since 2019, the state Department of Transitional Assistance caseload has increased about 50 percent, a rate McCue called “unprecedented.” 

Today, about one in six Massachusetts residents receive some kind of support through the state Department of Transitional Assistance, McCue said.

McCue said he has a “unique perspective” on the issue because he is in his second stint leading the department. He served as commissioner from 2015 to 2019, and then returned to the job in July 2023.

“When I left in 2019, I thought our caseloads were high. Our overload caseload level, we were serving about 735,000 people in the SNAP program,” McCue said, referring to the federally funded Supplemental Nutrition Assistance Program. “That number now is 1.1 million.”

Similar growth has hit Transitional Aid to Families with Dependent Children and Emergency Aid to Elderly, Disabled, and Children, which offer cash aid. In 2020, the state had fewer than 20,000 households receiving Emergency Aid to Elderly, Disabled, and Children; by January 2024, that had risen to nearly 30,000, according to the most recent Department of Transitional Assistance data.

The Transitional Aid to Families with Dependent Children and Emergency Aid caseload rose from roughly 30,000 households to about 34,000 early in the pandemic, then fell nearly to 24,000 in mid-2021. Since then, it has climbed steadily, reaching more than 43,000 households in January.

Governor Maura Healey’s fiscal year 2025 budget proposes about $496 million for the Transitional Aid to Families with Dependent Children and Emergency Aid program, about $52 million more than the spending bill she signed last summer, and nearly $179 million for Emergency Aid to Elderly, Disabled, and Children, a reduction of $7 million.

“Our goal now is to really double down on our economic mobility efforts and to match some of the key workforce gaps that have been identified in the commonwealth, partner with workforce development and other entities,” McCue said.

[Editor’s Note:  McCue’s discussion of welfare theft begins at 2:02:40 of the video of the legislative committee hearing.]

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