AUGUSTA, Maine — In a letter to Democratic leaders on Monday, Attorney General Janet Mills downplayed claims of EBT abuse made in recent months by Republican Gov. Paul LePage, framing the issue as fundamentally political.
“There is a great deal of talk this election year about welfare fraud,” wrote Mills, a Democrat. “I hope that we put this issue in perspective, and make sure we apply the rule of law fairly and uniformly, that we go after the big fish as well as the small, and that we not elevate one over the other.”
“Big fish” is a reference to pharmaceutical companies and other businesses and individuals who the attorney general’s office have pursued on charges of financial fraud and tax evasion, which Mills also outlined in her letter.
Electronic benefit transfer, or EBT, cards are loaded with welfare benefits including food stamps and funds distributed through the Temporary Assistance for Needy Families, or TANF, program.
In January, LePage released a list of EBT transactions at smoke shops, bars and strip clubs, which he said constituted abuse. Many of those transactions were likely ATM withdrawals, not over-the-counter purchases.
Reforming welfare and tracking down cases of abuse have been top priorities for LePage since he was elected in 2010, and are shaping up to be a key feature of his re-election bid this year. In his recent State of the State address, LePage pledged to limit the use of EBT cards and increase job application requirements for welfare recipients.
Democrats accused LePage of politicizing the issue, and advocates for the poor have said LePage’s laser-focus on where and how welfare recipients spend their benefits scandalizes the program and creates an atmosphere of suspicion toward low-income Mainers.
House Speaker Mark Eves, D-North Berwick, and Senate President Justin Alfond, D-Portland, had asked Mills to review the data and, if necessary, prosecute any incidents where the law appeared to have been broken. Mills’ letter on Monday was a response to that request. It was part of the Democrats’ call to “prosecute, not politicize” misuse of welfare dollars.
The attorney general’s office, Mills said, has successfully prosecuted 37 cases of DHHS fraud, which included “significant jail sentences and restitution orders totalling $489,954.”
A 2012 law barred the use of EBT cards at casinos, strip clubs and liquor stores, but their use at ATMs located in or near those establishment is still allowed. TANF funds can be withdrawn from ATM machines as cash, making those transactions by nature untraceable.
“Whether anybody has ever used EBT funds withdrawn from an ATM in any bank, store or other facility to purchase a pint of coffee brandy is beyond my direct knowledge, although I would not be surprised if this has occurred,” Mills wrote. “Such behavior, of course, is socially unacceptable and fiscally irresponsible. However, there are other antisocial behaviors involving the misuse of public funds which cause me equal or greater concern.”
Those include instances of tax evasion and tax fraud over the past three years that totaled nearly $1.1 million; and financial fraud cases totaling more than $730,000, including a business owner refusing to pay workers’ compensation insurance, a DOT employee stealing office supplies, a legislator stealing Clean Election funds and a grocery store letting customers use EBT cards to buy cigarettes and liquor.
Mills also emphasized the misdeeds of some health care businesses, which are capable of defrauding the government out of millions of dollars, rather than focusing on vastly smaller EBT transactions that may not even break the law. Her office’s HealthCare Crimes Unit recovered more than $55 million in state and federal funds from companies in the health care industry over the past three years, she said.
“While we are taking action against eligibility and recipient fraud which is more visible to the public and more talked about, provider fraud is also a very high priority for us,” she wrote. “These providers steal millions of dollars from the public purse and seriously undermine the public trust in our MaineCare program.”
State offices were closed Monday for Presidents Day. Attempts to reach anyone in LePage’s office were unsuccessful.
LePage and Mills have been at odds in the past, most recently over the state’s delayed release of a controversial Medicaid expansion study commissioned by DHHS. In a letter, Mills directed LePage to release the study to reporters and the public, to which LePage responded, “ Tell her to sue me.”
Follow Mario Moretto on Twitter at @riocarmine.