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THIS IS THE REAL SNAP FRAUD  
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Timothy Noah
January 2, 2026
The New Republic
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*
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*
*
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_ Scammers steal billions of dollars in food stamps from needy people
every year. Why isn’t Congress doing anything to stop them? _

,

 

When Republican politicians complain
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about “food stamp fraud,” they generally mean
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that some welfare cheat is ripping off the Supplemental Nutrition
Assistance Program, or SNAP, by falsely claiming eligibility.
Agriculture Secretary Brooke Rollins, for instance, is fixated
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on undocumented immigrants accessing the program illegally. “The
Democrat Party,” she said
[[link removed]] in November,
“built its entire strategy around protecting illegal aliens. They
know if the handouts stop, those illegals will go back home, and
Democrats will lose 20+ seats after the next census.” Never mind
that undocumented immigrants can’t vote.

MAGA hacks like Rollins seldom acknowledge that a SNAP beneficiary is
likelier to be the victim of a crime rather than its perpetrator.
So-called targeted benefit fraud
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is common, costing
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an estimated $12 billion per year. And Rollins has to know that a
thief who steals
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directly from a SNAP recipient is much likelier
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to be a hardened criminal than a SNAP recipient who bends or breaks
some eligibility rule.

“This is white-collar crime,” Mark Haskin of the Agriculture
Department’s special investigations unit told
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an Atlanta TV news reporter last year. “This is organized crime.”
A Romanian transnational mafia gang known as the Dorneanu Organized
Crime Group, for instance, allegedly led by one Mihai Dorneanu, stole
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over $180 million from California welfare funds, leading
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in February 2025 to 11 arrests by Romanian authorities, five by the
Federal Bureau of Investigation, and four by local police. Two members
remained at large after they cut their ankle monitors and jumped bail
in 2023. One of them was later arrested
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in Australia.

If some crook hacks your Visa or Mastercard and goes on a shopping
spree, Visa or Mastercard will make you whole. Federal law limits
[[link removed](fcba)] to
$50 a consumer’s liability for credit card fraud, and the more
reputable credit card companies typically won’t
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hold you liable at all. But if you’re a SNAP recipient and some
crook hacks your electronic benefits transfer, or EBT, card, you’re
out of luck
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No federal statute extends you the slightest protection, and, except
California and Maryland, no state will reimburse
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you out of its own funds. You just go hungry.

Bianca Hunter, a mother of two, had her SNAP EBT card declined
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last winter at Sam’s Club. When she checked the EBT app on her
phone, it showed that somebody in Chicago had purchased $559.49 worth
of food, emptying her account. Hunter didn’t live in Chicago; she
lived in Overland Park, Kansas. When she sought help at the Kansas
Department for Children and Families, she told KCTV in Kansas City,
she was advised, “There was nothing they could do about it.”

“So y’all aren’t going to replace my food stamps at all?” she
replied. “What am I supposed to do with my two kids; how are we
supposed to eat?

“They said we’ll just have to go to food pantries.”

 
It wasn’t always this way. At the end of 2022, Congress, noting a
Covid-era uptick
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in targeted benefit fraud, authorized
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states to reimburse
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at least some SNAP victims. (SNAP is funded
[[link removed](USDA)%20Food,(FNS)%20administers%20SNAP%20at%20the%20Federal%20level.]
by the federal government and administered by the states.) But the
legislation stipulated
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that, to be reimbursed, your benefits had to have been stolen between
October 1, 2022, and September 30, 2024, later extended
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to December 20, 2024. As the December deadline approached, Congress
bowed to the reality that the surge in targeted benefit fraud was
still growing and extended
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the deadline through September 2028. This was in a continuing
resolution [[link removed]], or
CR, that House Speaker Mike Johnson introduced on December 17, 2024.

Then a tweetstorm by the richest
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killed
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the CR.

“This bill is criminal,” Elon Musk tweeted
[[link removed]] December 18. Musk
also tweeted [[link removed]]
“Stop the steal of your tax dollars!” and
[[link removed]] “Ever
seen a bigger piece of pork?” and
[[link removed]] “Any
member of the House or Senate who votes for this outrageous spending
bill deserves to be voted out in 2 years!” The number of Musk tweets
and retweets that day exceeded
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100.

Much of Musk’s information, gleaned all or in part from the
conservative Twittersphere, was wildly inaccurate
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Musk said the CR raised congressional pay by 40 percent; it actually
raised congressional pay by 3.8 percent and, technically, wasn’t a
raise at all but a cost-of-living adjustment. Musk said the bill gave
Washington, D.C., $3 billion to build a new football stadium; it gave
D.C. no money at all, but rather transferred control of the site of
the former RFK Stadium to D.C. And so on.

In a sane world, Johnson would have ignored Musk’s ignorant
cyberkibitzing. Joe Biden was still president, and Musk a mere
functionary-in-waiting, designated
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by President-elect Donald Trump to run some pseudo-government agency
(really just
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a White House office) called the Department of Government Efficiency.

But ours is not a sane world. Trump famously hates to be upstaged, so
he quickly followed Musk’s fact-challenged tantrum with his own
fact-challenged demand
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“WITHOUT DEMOCRAT GIVEAWAYS.” By week’s end, Johnson pushed
through the House a substitute that jettisoned
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the offending provisions, including Congress’s tiny cost-of-living
pay adjustment and the D.C. land transfer, which was later passed as a
separate bill. Neither Musk nor Trump had singled out the SNAP
deadline extension for criticism, but the substitute CR excluded that,
too.

Last spring, a bipartisan group of Senate and House members, including
Senator John Fetterman, a Democrat from Pennsylvania, and
Representative Mike Lawler, Republican of New York, introduced
legislation
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to resume and extend indefinitely reimbursement to SNAP victims of
targeted benefit fraud. The bill went
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nowhere
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Instead, Trump’s Big Beautiful budget reconciliation bill cut
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SNAP spending by imposing work requirements and increasing states’
share of administrative expenses from about 50 percent to about 75
percent. The latter will increase
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annual state spending from anywhere between $13.9 million in Idaho to
$128 million in Wisconsin annually, according to the nonprofit Food
Research & Action Center, or FRAC.

In addition, the reconciliation bill for the first time will require
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states to share with the federal government the cost of the benefits
themselves, assigning them a portion of 5 to 15 percent, depending on
an individual state’s rate of payment errors (typically overpayments
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state starts losing
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federal funds if its error rate exceeds 6 percent—as all but eight
states did in 2024. A state error rate of 6 to 8 percent will require
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a 5 percent match; an error rate of 8 to 10 percent will require a 10
percent match; and an error rate over 10 percent will require a 15
percent match. Since 2024’s average state error rate was about 11
percent, most states will end up paying 15 percent. Cost sharing will
drain
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tens of billions annually from state budgets; big ones like Florida
and New York will pay more than $1 billion more, and the biggest,
California, will pay over $2 billion more, according to FRAC.

Between the federal government’s determination to cut SNAP spending
20 percent over 10 years—the largest reduction
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in the six decades of the program’s existence—and the massive
increase in what states will have to spend on SNAP, there’s little
appetite at the federal or state level to resume reimbursing
beneficiaries whose benefits get stolen. Instead, interest has shifted
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toward making the EBT cards that SNAP recipients use to pay for food
more secure. But progress here is slow
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because that costs money, too.

 
People call SNAP the “food stamp program” because a predecessor
program
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created during the Great Depression distributed the benefit through
post offices in orange-and-blue stamp books. When the modern food
stamp program was initiated
[[link removed]] in 1964, the benefit
was a paper coupon
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distributed by the states. As the program scaled up, opportunities for
fraud increased [[link removed]].
Most famous was the case of the “welfare queen
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about whom Ronald Reagan demagogued endlessly during his 1976
presidential campaign—a woman named Linda Taylor whose life story
turned out to be too extravagantly dark and weird to make her an
example of anything. The more run-of-the-mill type of food stamp fraud
was enabled by the ease with which paper coupons were stolen or
counterfeited. Paper coupons were also conspicuous, which created
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stigma at the checkout line for SNAP recipients.

Riding to the rescue in the early 1990s was retirement
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of the “knuckle buster
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a clumsy manual device used to make a carbon of every credit card
purchase, and introduction of the much faster and easier electronic
point-of-sale, or POS, device. If a retailer could use this digital
marvel to extract credit or cash instantaneously from a bank account,
policymakers realized
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surely that retailer could also use it to extract ­preassigned
transfer payments from the Treasury. Paper coupons redeemable to buy
food were as much of a nuisance as finger-bluing carbon receipts. Why
not use POS devices instead? No more fraud, no more stigma, I remember
an Agriculture Department official crowing when I wrote about the
anticipated shift as a young _Wall Street Journal_ reporter.

Independent owners of corner grocery stores and bodegas were resistant
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to purchasing new point-of-sale equipment that would accommodate EBTs,
so it took a succession [[link removed]] of
federal laws to effect the changeover, culminating in 1996 with a
provision
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President Bill Clinton’s welfare reform bill requiring states to
deliver SNAP benefits electronically by the start of fiscal year 2003.
(Yes, the same bill that fulfilled
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Clinton’s campaign pledge
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to “end welfare as we know it” digitized food stamps.)

But criminality abhors a vacuum. The advent of digital commerce
prompted international crime rings to exploit
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the insecure magnetic stripes on credit and debit cards with a
technique called “skimming
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Self-serve fuel pumps, automated teller machines, and POS machines
were altered to read and transmit keystrokes, enabling criminals to
obtain credit and debit card numbers and PINs. Often these devices
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were as simple as an ultrathin layer of plastic placed atop the keys.

The credit card companies countered
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by developing more secure chip and “tap-to-pay” features, and by
loading credit cards onto cell phones. Adoption
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of the new technology was initially slow, but demand skyrocketed
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during the Covid pandemic as customers sought contactless forms of
payment, especially at grocery stores, the most difficult type of
retail establishment to avoid. The other thing that happened during
Covid was that Congress expanded
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SNAP eligibility and increased the average monthly benefit from about
$120 per person to about $230. Ever-adaptive, criminal gangs shifted
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their target from newly secure credit cards to newly flush SNAP EBTs,
which still relied on insecure magnetic stripes.

THE OBVIOUS SOLUTION IS TO UPGRADE ALL EBTS WITH CHIPS AND TAP-TO-PAY.
BUT ONLY ONE STATE, CALIFORNIA, HAS DONE THAT SO FAR, BECAUSE IT’S
EXPENSIVE.

The obvious solution [[link removed]]
is to upgrade all EBTs with chips and tap-to-pay. But only one state,
California, has done that so far
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expensive; California’s upgrade cost
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because those corner grocery stores and bodegas will once again be
slow to upgrade their POS devices, California’s new card
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has a magnetic stripe, too, which still leaves it somewhat vulnerable
to fraud. Senators Ron Wyden, a Democrat from Oregon, and Bill
Cassidy, a Republican from Louisiana, introduced a bill
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in 2024 requiring states to make the changeover, but it didn’t have
enough stand-alone support
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and a hoped-for farm bill to which it might have been amended failed
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to materialize. Today, with partisan divisions leaving congressional
appropriators limping
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from one short-term CR to another, no farm bill seems likely anytime
soon.

In November 2024, then-Agriculture Secretary Thomas Vilsack sent a
letter
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governors in 50 states announcing that the nonprofit American National
Standards Institute had developed
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specifications showing how states could transition
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to the more secure chip and tap-to-pay technology. That same year, the
Agriculture Department directed
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grocers to an online guide to help them make the changeover and said a
proposed regulation would be forthcoming to “establish timeframes
for upgrading to secure payment technologies.”

We’re still waiting for that proposed regulation. Vilsack’s
successor, Rollins, included SNAP benefit theft among the items
targeted
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in her “National Farm Security Action Plan,” but her main solution
was to punish retailers judged insufficiently vigilant. In general,
Rollins seems more preoccupied with chasing
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undocumented immigrants, penalizing
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didn’t suspend full SNAP payments during the government shutdown,
and making all SNAP recipients reapply
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for benefits. Addressing actual SNAP fraud committed by real criminals
like the Dorneanu Organized Crime Group is a low priority. “They
conflate fraud, and payment error, and abuse,” one Democratic
congressional staffer told me. “They just want to talk about things
in a general miasma.”

_TIMOTHY NOAH_ [[link removed]]_ is a
New Republic staff writer and author of The Great Divergence:
America’s Growing Inequality Crisis and What We Can Do About It._
_The New Republic_ [[link removed]]_ was founded in 1914 to
bring liberalism into the modern era. The founders understood that the
challenges facing a nation transformed by the Industrial Revolution
and mass immigration required bold new thinking._

_Today’s New Republic is wrestling with the same fundamental
questions: how to build a more inclusive and democratic civil society,
and how to fight for a fairer political economy in an age of rampaging
inequality. We also face challenges that belong entirely to this age,
from the climate crisis to Republicans hell-bent on subverting
democratic governance._

_We’re determined to continue building on our founding mission._

_Sign up_ [[link removed]]_ for a TNR
newsletter on politics, climate, culture and more._ 

 

* SNAP
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* consumer fraud
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* white collar crime
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