Food Stamp Fraud Not Banksters

Going after criminal cases targeting fraud has come down to what’s easier to prosecute for the Obama administration.

While Americans of all stripes have clamored for justice in the wake of the financial crisis, the U.S. Department of Justice has chosen to not pursue jail time for banking executives whose decisions wreaked havoc on the financial industry and the economy. The reason: Building cases against bankers is just too hard to do and carries too much risk of failure in the courtroom.

Instead, the Justice Department has allowed the Securities and Exchange Commission to pursue civil cases directed at banks that can yield large financial penalties, but no criminal prosecutions.

With bank fraud out of reach, federal prosecutors have reached for lower-hanging fruit—namely, food stamp cheaters.

The lousy economy has resulted in a surge of Americans on food stamps and a corresponding increase in those fraudulently using the assistance, according to administration officials. More than 46 million people are receiving about $75.3 billion in help from the Supplemental Nutrition Assistance Program (aka food stamps). Of this amount, more than $750 million may be spent fraudulently, says Obama’s people.

Seven hundred and fifty million dollars is nothing to sneeze at. But compared to the total expenditure for food stamps, the amount of potential fraud going on amounts to only 1%.
–Noel Brinkerhoff

Why No Financial Crisis Prosecutions? Ex-Justice Official Says It’s Just too Hard (by Marian Wang, ProPublica)
An Ex-FBI Official Explains Lack of Convictions Tied to Financial Crisis (by Joe Palazzolo, Wall Street Journal)

Obama Administration Targeting Food Stamp Fraud as Program Reaches Record Highs (by Ed O’Keefe, Washington Post)

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