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Congress Must Take Bold and Immediate Action to Address EBT Skimming Crisis

diciembre 15, 2022

CalFresh (SNAP) is the first line of defense against hunger, lifting over 2 million Californians out of povertyy providing critical food benefits to more than 4.7 million people. Acerca de 81% of households who receive benefits include a child, elderly individual or a person with disabilities.

This past year, California and several other states have seen a dramatic increase in benefits being stolen electronically through “skimming” and phishing crimes. Skimming occurs when a device is covertly placed on an ATM or POS (point of sale) machine to capture the PIN and the data stored on the magnetic strip of a payment card. This happens without the beneficiary ever knowing that it has happened, and the criminals who have stolen the EBT card information then use it to duplicate the card and use it at stores that accept EBT cards.

Across California and in the last year alone, the California Department of Social Services estimates that more than $2.5M in CalFresh benefits that were stolen (and have subsequently been replaced), while news reports suggest that the total amount of stolen benefits (both CalFresh and CalWORKs) total upwards of $3M per month. Just this past September, 16 criminals in Los Angeles were prosecuted, and we know the problem is becoming more rampant across the state.

We are asking that in the earliest possible legislative vehicle, Congressional leaders take two actions to address this crisis:

  • Restore SNAP benefits for victims of EBT electronic theft and reimburse states for the costs to restore benefits, and;
  • Ensure that the USDA and states who administer SNAP swiftly implement technology improvements to strengthen the ongoing security of EBT benefits without impeding customer access to prevent this theft into the future.

Impact of EBT Skimming on California Communities

The way that CalFresh recipients typically find out that their benefits have been stolen is while at the grocery store, assuming they have their expected balance on their card, only to find out that their benefits have been wiped out when they try to pay for their groceries:

For some people like Leticia Monroe, EBT is the only way they can survive.

“It’s the only way I can take care of my bills, my rent, medical, medicine any other things I need to take care of me and my son,” said Monroe, who as a disabled single mother, relies solely on public assistance, which she receives on an EBT card.

She was targeted by scammers last month, when she had nearly $700 stolen from her card the day funds were deposited, leaving her with just $6.51 for all of her bills.

Thankfully California replaces up to one-month’s value of stolen CalFresh benefits, making our state the only state in the country that replaces any skimmed benefits, but the theft has to be reported within 10-days, making it challenging for people to report it.

California’s Leadership in Mitigating Harm from EBT Skimming

California has been working diligently over the last 10 years to alert federal partners to the detrimental impact of EBT card skimming, and we have also proactively worked to mitigate this harm through state policy and budget investments.

  • In 2012, California passed AB 2035 (Bradford), which expands EBT cardholder protections and replacement of stolen benefits, by ensuring that recipients will not incur any loss of benefits that are taken by an unauthorized withdrawal, removal, or use of benefits that does not occur by the use of a physical EBT card issued to the recipient or authorized third party to directly access the benefits. In following guidance released by the CDSS in 2013 (ACL 13-67), a reporting process for victims of EBT card skimming and electronic theft was established.
  • In 2018, California passed AB 2313 (Stone), further strengthening protections for victims of EBT card skimming and electronic theft in California, and published subsequent guidance to counties (ACL 18-148).
  • In 2020, in the case of Ortega v. Johnson, the appellate court found that CalFresh recipients are entitled to one month of replacement benefits when benefits are lost due to electronic theft, provided the request for replacement is made within 10 days of the loss. Following this decision, the CDSS released guidance to counties on how to report stolen benefits (ACL 21-133).
  • This year, Sen. Umberg authored SB 1140, which would have codified the California Court of Appeals decision in Ortega v. Johnson, allowing for timely reimbursement of a CalFresh recipient’s benefits when they are stolen electronically, but it was vetoed.
  • In August of this year, USDA awarded California $740,000 for the Fraud Framework Implementation Project, to implement the Thomson Reuters Fraud Detection System. While California is grateful for this opportunity to improve information and methods of identifying fraud, it will not address the underlying issue with EBT card skimming.
  • And just last month, the CDSS developed a Public Service Announcement video alerting counties and their communities about the growing problem of EBT card skimming.

We Call on Congressional Leaders to Take Immediate Action

On December 9, Senator Bradford and a bipartisan coalition of 28 California legislators sent a letter to the California Congressional Delegation asking for immediate federal action on the EBT skimming crisis. This letter asks Congress to provide critical relief, with funding to replace the stolen benefits, coupled with ongoing improvements to EBT benefit security to limit this theft going forward. We applaud these California senators and assemblymembers for signing on to this letter and we urge Congress to prioritize a solution to this crisis in the soonest possible legislative vehicle in the 117th Congress.

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