Texas Fingers Welfare Fraud

Don't even think about using a fake ID to get welfare benefits in Texas. The Lone Star State is fingerprinting applicants, to the dismay of privacy advocates. By Lindsey Arent.

It just got harder to mess with Texas.

The Texas Department of Human Services has turned to biometric identification -- that is, fingerprinting -- to keep would-be welfare frauds from costing the state millions.

In 1995, the Texas legislature passed a bill requiring the DHS to make the welfare application process more secure and minimize fraudulent claims.

In response, state officials created the Lone Star System, which requires applicants to provide fingerprints to receive benefits. The system was designed to prevent people from signing up for food stamps or the Temporary Assistance to Needy Families program more than once, officials said.

"Once we build this database, if someone were to try to obtain duplicate benefits or bilk the system, they'd be discovered," said Human Services spokesman Michael Mahoney.

But privacy advocates are concerned that the program could be used as a form of legalized governmental surveillance.

"Biometrics are a double-edged sword," said Barry Steinhardt, associate director of the American Civil Liberties Union. "They may be a tool for advanced security but they also are a tool for invasion of privacy."

Texas currently manages 630,348 public assistance cases for food stamps and temporary aid combined. In 1998, total food stamp and temporary aid disbursements amounted to nearly US$2 billion, according to the DHS.

Human services officials estimate that fraud cases amount to roughly half a percent per year, or $9 million.

"Nobody knows for sure how bad the fraud was before the system was implemented because it's difficult to detect. It's usually discovered by accident," Mahoney said.

"It’s the kind of loss that can be described as chronic loss," he said. "It would continue to happen for years. This program closes that loophole."

Welfare officials estimate the imaging system will save $16.1 million over the next five years, including the $12.8 million it cost the state to implement the program.

The Lone Star system, designed by biometrics firm Sagem Morpho is made of a PC, a finger scanner, and a video camera.
DHS workers enter the applicant's demographic information, digital photo, and fingerprints into the system.

An applicant places two fingers, one at a time, on a square-inch scanner screen. The image is sent to a central matching facility in Austin that verifies overnight whether the finger images are already in the system.

"If the answer is no, then it's safe to assume that that person has not applied for assistance under a different name," said Sagem Morpho spokeswoman Sandra Salzer. "If it is yes, those results are sent to fraud investigators."

The inspectors determine whether the match is "truly fraud or simply an administrative error," Salzer said. "Did the intake worker improperly enter this person, or was there a change of names? People sometimes forget they already applied."

The fingerprint imaging system will be up and running in 400 DHS offices scattered throughout the nation's second-largest state by 23 August.

So far, six states, including California, New York, and Massachusetts use finger-imaging systems to regulate welfare fraud. Five more, including New Jersey and Florida, are in the process of building systems.

Mahoney said the system will only be used for welfare fraud management, not for law enforcement of any kind.

"This is a standalone database and it's as secure as a database can get. Because we are a social service agency, all our client information is confidential," Mahoney said. "All the information is taken at an office and sent electronically to a database in Austin, it’s self–contained."

But even the most secure databases cannot be relied upon, Steinhardt said.

"Databases that are created for one purpose are rarely restricted to that one purpose, and laws can and are amended," he said. "Once you create these identification systems, someone will always advance a good reason to access them. There's nothing to prevent law enforcement from getting a court order and getting into that database."

Steinhardt believes that, although biometrics profiling may start with the disadvantaged, it could extend to a wide variety of transactions, such as financial services.

"Welfare recipients are a relatively powerless, unpopular group," Steinhardt said. "But the use of biometrics isn't going to end with welfare recipients. This is really just the tip of the iceberg."