Rampant Fraud in Taxpayer Funded Child Care System
The MJS has a superb story about the rampant fraud in a government-subsidized child care program. Here are a few of the gory details:
On paper Angela Hale is a child-care provider.
She reported taking care of the same five kids seven days a week while their mom supposedly worked at a lawn-care service, even in the winter months.
The government paid Hale more than $30,000 last year for her child-care business.
It appears the government got duped. Hale didn’t care for the kids at times she said she did, nor did the mom legitimately work, the Journal Sentinel found.
The newspaper spent four months investigating the $340 million taxpayer-financed child-care system known as Wisconsin Shares and uncovered a trail of phony companies, fake reports and shoddy oversight.
[...]
• Counties accept almost anything as proof of employment for parents seeking child-care assistance. Notes from employers, phone conversations, checks stubs - all of which are easily fabricated - serve as sufficient proof. As a result payments are sometimes approved based on bogus jobs.
• Caseworkers sign off on child-care arrangements that defy the imagination. In one instance, child-care funding was approved for 85 hours a week even when children were in school all day. If the statements were to be believed, the children would almost never be home. In another case, a woman was granted child-care assistance to work 236 of 238 days, including the day she gave birth to her seventh child.
• Regulators seldom revoke licenses for fraud and are slow to act even when they have strong evidence. In at least two cases, government officials suspected that providers were falsifying documents for three years before finally moving to shut down the child-care operations. Prosecutors have filed only one child-care fraud case in the past five years.
[...]
State and local officials admit that when providers are caught billing for hours children are not actually in their care, it’s typically treated as an error rather than as a crime.
And no parent has ever been criminally charged for fraudulently enrolling a child, prosecutors in the five counties said.
It’s impossible to know the scope of the swindling. The state hasn’t completed a full audit of the program since 2001.
In addition, the state and local governments declined to release much of the information needed to reveal the inner workings of the scams - removing any possibility for the public to hold the government accountable.
To be able to tell this story, the Journal Sentinel reviewed about 2,500 pages of public records, conducted spot checks and obtained from sources thousands of additional pages of state and county documents that regulators refused to release.
Even with access to only a limited number of cases, the Journal Sentinel was able to identify nearly $750,000 in suspicious child-care disbursements.
Yes, I know…. “there’s no fat to cut” and “if it helps one family.” All of this is infuriating, but not unsurprising. This is the paragraph that put me over the top:
“It’s a good system,” said Dawn Ramsey, child-care coordinator and a supervisor of the financial and employment planners who process applications. “It’s helped a lot of people. But like any other system there is fraud involved.”
People like this are the problem. They shrug their shoulders when confronted with obvious malfeasance. Yes, any system has fraud, but it is clear from the MJS report that this system is rife with fraud precisely because people like Ramsey don’t give a crap. They rubber-stamp claims and don’t even make the slightest effort to see that the money is being spent correctly.
This agency should be audited immediately and people like Ramsey should be fired. Let’s get some people in there running the system who don’t tolerate fraud.
I tried, but couldn’t, find three critical words in the piece: Governor Tommy Thompson.
Posted by Michael Mathias on January 25, 2009 at 1021 hrs
This agency should be audited immediately and people like Ramsey should be fired.
A Civil Service employee fired? Once in a blue moon, guy. Seriously, you’re far more likely to win the lottery than get a CSE fired for incompetence. It takes great malfeasance to fire someone.
My brother got hired by the DOT as an IT contractor. His job was to do the job of the other 12 folks in the department since they wouldn’t or couldn’t. And as he put it, he could do the work of all 12 folks in about 6 hours a day, but he pads it out. He can’t believe how bad the work ethic is there until I explained what it was like being on the other side of the Civil Service equation.
Posted by .(JavaScript must be enabled to view this email address) on January 25, 2009 at 1035 hrs
As I read the article (which I must agree, the MJS did an outstanding job on this one), my main thought is that an investment needs to be made in the verification process. My suggestion would be that as soon as clients are put on the program, all file information is turned over to a private contractor who has the access & ability to research public records. This process should not be conducted by public employees of the agency involved, and furthermore, there are enough private investigators that would have the ability to “ramp up” to such a task - it really isn’t that hard to learn to do this kind of research, it is a matter of having access to records and knowing where to look. Put it up for bids, audit the performance of the contractors, etc.
Posted by .(JavaScript must be enabled to view this email address) on January 25, 2009 at 1038 hrs
Agreed, one excellent piece of work by the JS.
I further like mht’s suggestion to hire an private contractor to certify the requests. Seems that a few searches, a couple phone calls could begin to weed out fraud. Also, as word gets out that the gravy train has been derailed, perhaps the cycle begins to narrow. Based on the research performed by the JS, the funding to perform these checks may offset the fraud.
One other issue is the Federal government’s role in lack of oversight. According to the article, $5 billion is spent in the form of grants for child care development; however the only audit performed is a listing of how the money was spent.
And we’re about to hand over $1 TRILLION of our children and grandchildren’s money to continue pushing an up cycle in the economy?
Posted by .(JavaScript must be enabled to view this email address) on January 25, 2009 at 1216 hrs
Who pays for this private contractor? If the state and counties already can’t afford adequate staff for the number of cases they handle, how can they afford to send off even more tax dollars to more people?
Also in the article:
The number of people flocking to the program doesn’t make oversight any easier.
In Dane County, the number of cases of economic support, which includes Wisconsin Shares, soared to more than 23,000 last year - up 77% from five years earlier. The number of workers processing the cases has stayed about the same, said Sara Shackleton, who was associate division manager for economic support before retiring in December. The county recently had gone six months with no fraud investigator, she said.
Kenosha, Racine and Brown counties have seen their number of cases jump as well.
“Worker caseloads are ridiculous,” said Mark Quam, director of Brown County Human Services. “There’s constant pressure of pushing stuff through as fast as you can. They’re always under the gun.”
It seems that inadequate staffing and oversight make fraud easier to perpetrate, and giving counties the resources to deal with their caseloads could solve a lot of the problem.
Posted by folkbum on January 25, 2009 at 1233 hrs
folkbum,
First, the MJS clearly showed that even in the cases they reviewed, they failed to see obvious fraud. For example:
In one instance, child-care funding was approved for 85 hours a week even when children were in school all day.
Sorry, but anyone even paying half-ass attention should have caught that. Having a high case load is no excuse for missing something that wouldn’t have even required a phone call to recognize that something wasn’t right.
Furthermore, if we eliminated the fraud from the system, then that would diminish the workload too, right? And then we could focus the money on what it was intended instead of allowing crooks to have easy access to it.
Posted by Owen on January 25, 2009 at 1242 hrs
Who pays for this private contractor?
What I said:
an investment needs to be made in the verification process
Probably the actual savings in fraud not performed & the inhibition of future behaviors like this would offset the costs. In any event, personally I think there has to be integrity in the programs & it needs to be outside of the system, even if there is a cost.
The old saw, “it’s for the children” perpetuates this group-think:
“It’s helped a lot of people. But like any other system there is fraud involved.”
What is needed is the will to not accept fraud as inevitable.
Oy, what havoc will we see with the stimulus spending programs waiting in the wings?
Posted by .(JavaScript must be enabled to view this email address) on January 25, 2009 at 1251 hrs
“I tried, but couldn’t, find three critical words in the piece: Governor Tommy Thompson”
What a moronic comment. He’s been gone for a long time and it’s not his problem.Posted by .(JavaScript must be enabled to view this email address) on January 25, 2009 at 1310 hrs
Dan—it was his program.
Posted by Michael Mathias on January 25, 2009 at 1410 hrs
Dan—it was his program.
So rather than discuss the issues, you’d rather point fingers. How petty and small of you.
Posted by .(JavaScript must be enabled to view this email address) on January 25, 2009 at 1435 hrs
I think that those that are caught should be made examples of and all their work should be audited.
Having said that, I have to wonder about the word “rampant” Several examples are discussed and rightfully so but compared to the numbers that are legitimately enrolled I am not so sure how rampant it is.
I believe that when we see it we need to report it to the authorities. I believe it happens all over and some are very good at it. We need to make a few examples to show them it is serious and hold them accountable.
Posted by .(JavaScript must be enabled to view this email address) on January 25, 2009 at 1516 hrs
Dan—it was his program.
Gee, I didn’t know he was still in government and responsible for it. You learn something new every day!
Posted by .(JavaScript must be enabled to view this email address) on January 25, 2009 at 1558 hrs
This was a good job by MSJ. This is not a good use of our tax dollars. Someone in the state legislature needs to jump on this issue and fix it. And while they’re at it, maybe a look at all agencies might be in order.
Posted by yoSAMite on January 25, 2009 at 1634 hrs
Oh yes - more government is the answer!
Here were the bulk of those stimulus dollars are going to go - into poorly managed government projects…
Posted by .(JavaScript must be enabled to view this email address) on January 25, 2009 at 1804 hrs
“Dan—it was his program.
Gee, I didn’t know he was still in government and responsible for it. You learn something new every day!”
This from people who are still probably blaming our economic problems on Bill Clinton…or Jimmy Carter.
Posted by .(JavaScript must be enabled to view this email address) on January 25, 2009 at 2135 hrs
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Posted by charu on January 26, 2009 at 0222 hrs
This from people who are still probably blaming our economic problems on Bill Clinton…or Jimmy Carter.
But Mom, he started it!!!
Christ, I think any rational thinking adult can see there is a huge problem with this program, and an unscrupulous few are taking advantage of it. Instead of talking about what’s wrong, you two, Keith and Dan, are trying to derail the conversation. Can’t you just stay out?
Posted by .(JavaScript must be enabled to view this email address) on January 26, 2009 at 1038 hrs
I thought yesterday’s article was the epitome of stupidity - this is much worse (warning, put away all your sharp objects and firearms before reading this):
http://www.jsonline.com/watchdog/watchdogreports/38309864.html
Child care loopholes lead to easy money
Sisters get $540,000 from state mostly for watching each other’s kids, and it’s perfectly legal
The two-story house on 17th St. looks typical of the working-class homes on Racine’s west side. Three bedrooms, one bath. Assessed by the city at $122,000.
Yet inside, a young woman has tapped into a home-based money-making operation that netted her and her three sisters more than half a million in taxpayer dollars since 2006.
And they did it with the blessing of the state.
All four had been in-home child-care providers. Collectively they have 17 children. For years, the government has paid them to stay home and care for each other’s children.
Nothing illegal about it under the rules of Wisconsin Shares, the decade-old child-care assistance program designed alongside Wisconsin’s welfare-to-work program.
“It’s a loophole,” said Laurice Lincoln, administrative coordinator for child care with the Milwaukee County Department of Health and Human Services. “Do we have concerns about it? Yes, it can be a problem. But if it’s allowed, it’s allowed. We really can’t dispute it.”
Get it? 4 sisters, 17 kids, getting paid to take care of each other’s kids. Each one’s “employment” is taking care of the other’s kids.
And like yesterday’s article, the typical bureaucratic “shoulder-shrug” - “But if it’s allowed, it’s allowed”.
Posted by .(JavaScript must be enabled to view this email address) on January 26, 2009 at 1143 hrs
“Who pays for this private contractor? If the state and counties already can’t afford adequate staff for the number of cases they handle, how can they afford to send off even more tax dollars to more people?”
I’d be more than willing to take that job for 1/2 of the savings I find in fraud, and I wouldn’t be the only one. That job would easily fund itself.
As for firing the workers involved in this. I think that is way too lenient. They stated in this article that workers suspected these cases were fraud for years. I think at that point they are just as culpable as the thieves stealing this money, and should be doing hard time right next to them. They knew a crime was being committed, and was going to be committed next month and the month after that. I think that makes them accessories after the fact.
In a fair world, everyone in this article and the government workers involved would be doing 20 years in prison. And as mad as I am for my wasted tax dollars, I’m just as mad that the money wasn’t used to actually help someone in need.
Posted by .(JavaScript must be enabled to view this email address) on January 26, 2009 at 1159 hrs
If you find this waste of taxpayer money offensive, wait til you see the KBR invoices from Iraq.
Posted by .(JavaScript must be enabled to view this email address) on January 26, 2009 at 1312 hrs
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