Fraud runs rampant in DHS feeding programs
While highly disappointing, it comes as no real surprise to learn that Arkansas’ largest and most expensive agency, the Department of Human Services, is again in hot water for failing to develop internal controls that allowed more than $11 million in fraud in programs created to feed hungry children.
The programs, under investigation by federal agencies, include an at-risk after-school component during the school year as well as a summer nutrition program to feed children while school is out.
Agents of the FBI, the Internal Revenue Service, the U.S. Marshals Service as well as the U.S. Department of Agriculture say in their report DHS fell behind in performing compliance reviews, did not require receipts for reimbursement claims and had an insufficient system for monitoring nonprofit institutions.
But now, and millions of dollars later, members of the Legislative Joint Auditing committee were told everything is okay now that the state agency has entered into an agreement with out-of-state firms that specialize in ensuring the federal dollars are spent properly.
The question this committee should be asking Kessa Smith, deputy director of the DHS department, is why should this state’s largest agency have to hire out-ofstate agencies with federal funds to do the job DHS should be handling?
And, why does it take an investigation by multiple federal agencies into this dastardly deed for DHS management to realize they had such a major problem?
Smith tried to say her agency was now in the process of making the necessary corrections but couldn’t explain the discovery that DHS “insiders” paved the way for the others to sign up as sponsors for food-providing programs operated by the Child and Adult Care Feeding Program. And, according to Assistant U.S.
Attorneys Jana Harris, Allison Bragg and Cameron McCree said in some cases, no children were served by these food programs.
Nor could this deputy director say much to the fact that two DHS employees who worked in this agency admitted to federal agents to being the “gatekeepers” who, in return for bribes, made it possible for the others to defraud the program.
So far 14 people have been arrested and charged in this disgraceful scheme since December 2014, two were convicted in a jury trial in April and await sentencing; five pleaded guilty and have been sentenced; and seven others who pleaded guilty before trial also await sentencing.
Correcting this illegal activity won’t be cheap. An Arizona firm will be getting a maximum of $51,987 to conduct school lunch reviews while a Georgia firm will be paid a maximum of $3.14 million to perform reviews and site visits for the Child and Adult Care Food Program and the Summer Food Service Program.
It is bad enough DHS supervisors failed to catch this fraud going on under their noses but what makes it absolutely worse is that what these criminals did was take food from children in need and were hungry.
We find this absolutely disgusting and there should be absolutely no excuse DHS officials give to ease their minds.