OC Fraud Unit prevented $1.4 million of overpayments in 2022, with $46K more recovered

Press Release, Orleans County Department of Social Services

ALBION – The Orleans County Department of Social Services Fraud Unit is staffed by two investigators who review circumstances on both active and pending cases for applicants/recipients of Supplemental Nutrition Assistance Program (SNAP), Medicaid, Home Energy Assistance Program (HEAP), Day Care, Emergency Assistance and Cash Assistance.

Referrals to the Fraud Unit initiate from staff, hot line tips from the public, database matches with Department of Labor and Wage Reporting System, and other public and private agencies.  Investigations are done on known or suspected violations of the law, related to fraudulent receipt of welfare funds.

A typical fraud investigation consists of interviewing applicants/recipients, unscheduled site visits to applicant/recipient residences, and by making direct contact with retailers, employers, landlords, and other individuals associated with the individual suspected of committing fraud. Some instances of fraud are appropriate for court prosecution resulting in criminal charges being lodged such as Filing a False Instrument (the Application for Benefits), Petit Larceny or Grand Larceny.

The success of fraud mitigation efforts is measured in two ways:

• Cost avoidance is the upfront savings realized when a case is prevented from opening due to detected irregularities in the application. Applications are referred to the Fraud Investigator by Examiners in our Temporary Assistance or Day Care unit when specific indicators are present such as inconsistencies in reported income/resources, household composition, or prior case history.

If the investigator confirms inaccurate information, or if the applicant fails to keep their investigative appointment, benefits will not be issued. New York State establishes the basic cost per case which, when multiplied by the number of cases not opened, results in the cost avoidance amount. In 2022 the cost avoidance for Orleans County was estimated to be $1,389,462.

• Recovery is the actual monetary amount the agency collects when overpayments are verified to have occurred. In 2022 the amount established to be recovered for SNAP and Cash Assistance overpayments was $52,692 and the amount adjudicated by the court for recovery was $46,121.

Recoveries established by the Court are repaid through the Probation Department and the remainder are paid to Orleans County Department of Social Services. It is important to note that most of the money recovered is returned to either the Federal or New York State government and not returned to the county coffers.

An additional outcome that can result from a Fraud substantiation is the Intentional Program Violation (IPV). If it can be established than an overpayment to an applicant/recipient was an intentional act, that applicant/recipient can be disqualified from receiving future benefits:

• For Cash Assistance the disqualification period can be 6 months, 12 months, 18 months and 5 years.
• For SNAP, the disqualification period can be 1 year, 2 years, and permanently for the third offense.
• Disqualification periods are tied to the number of previous offenses.
• If the IPV is the results from criminal charges, the Judge imposing the sentence can increase the length at their discretion.

During the height of the pandemic Orleans County cost avoidance and recovery figures decreased due to New York State relaxation of some eligibility criteria.  As those restrictions have been gradually lifted, the number of investigations has increased.

For suspected cases of fraud call the Orleans County Fraud Hotline at 589-3110 or 589-3178.