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Iowa Watchdog

Iowa welfare dollars continue to go unmonitored


DES MOINES – Officials at the Iowa Department of Human Services told a state senator Wednesday they have sufficient safeguards in place to prevent fraud among food stamp recipients, but that lawmaker is still concerned about the lack of monitoring in the welfare program.

Republican Sen. Brad Zaun requested a meeting with Chuck Palmer, head of the department, after reading an Iowa Watchdog article regarding welfare payments and a lack of oversight by department officials of the $100 million program.

Iowa continues to fail tracking welfare dollars.

Iowa continues to fail tracking welfare dollars.

Palmer and the department’s chief operating officer met with Zaun and, instead, spoke to him about safeguards built into the state’s food stamp program. They also sent him information prior to the meeting giving an overview of both the food stamp and welfare program.

The email failed to address the question Zaun posed: what safeguards did the department have in place to monitor the welfare program and prevent fraud.


“I need more detail,” Zaun told Iowa Watchdog after the meeting. “I am definitely concerned.”

Palmer told Zaun the Iowa Department of Inspections and Appeals oversees compliance with the state’s food stamp program. Also, Xerox, the company the state contracts with to provide payment to both welfare and food stamp recipients, has a unit constantly monitoring transactions that show patterns indicating abuse or fraud.

Iowa officials, additionally, monitors Craigslist, eBay, Amazon, Facebook, Twitter and MySpace to find cases of fraud involving food stamps. It does not, however, do the same for welfare dollars, which are meant to help provide necessities to the poor.

Department of Human Services and Iowa Attorney General Tom Miller have said it’s not the state department’s job to monitor how welfare recipients spend their money. Once the department hands the $100 million over to Xerox, there is no oversight ensuring they or recipients use the money appropriately.

Other states, including New Mexico and Kansas, obtained welfare transaction data that showed recipients used the cards at casinos, liquor stores, bars and casinos. That prompted federal legislation that will take effect in January and requires states to take steps to keep taxpayer dollars from being used at those locales. So far, Iowa has no plans for compliance, according to DHS spokesman Roger Munns.

In contrast to the welfare program, state officials heavily monitor food stamp dollars, as required by federal law. Cards can’t be used on items not covered under the law. Xerox, which also monitors the food stamp program, regularly produces reports on recipients who have multiple replacement cards, a number of high out-of-state transactions and balances of at least $10,000.

The state and Xerox will adopt increased security measures and better reports in November that include same address recipients, cards used in different cities in a short time frame, high dollar returns that indicate retailer fraud and the top 50 retailers which also can indicate fraud, according to DHS documents.

“My job is to look over how all of the tax dollars are being allocated,” Zaun said. “I am definitely concerned.”

Contact Sheena Dooley at Sheena Dooley is the Iowa bureau chief for, where this story first appeared.

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