
An algorithm kicks businesses out of food stamp program on dubious fraud charges - Futurebot
https://newfoodeconomy.org/usda-algorithm-food-stamp-snap-fraud-small-businesses/
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classics2
Uhh he did violate the terms of acceptance, nothing nebulous at all here. He
violated, they actually gave him a process to try and prove his violations
were not and he failed at that and was banned.

Very misleading title.

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chrisseaton
> kicks businesses out of food stamp program on dubious fraud charges

> Mejia violated the agency’s rules, which prohibit retailers from
> establishing informal credit systems with their customers.

> many of them, like [Mejia], were probably unjustly caught in the crosshairs

So which is it? Is the charge unjust and dubious, or did he violate the rules?

(Not making any political point myself - just can't even work out what the
opinion of the article is on whether he was doing something that was not
allowed in the system he was using.)

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raincom
He violated rules, rules that were set up to avoid fraud. This is what
happens, when one reduces everything to a set of rules.

There are actions that are not fraudulent (as the case with Mejia), but
considered fraudulent by rules set up by the agency. This is a case where
agencies hide behind rules, algorithms, etc.

~~~
stretchwithme
You have to have rules for such a program. You can't have fraud judged
arbitrarily or allow anything regardless of how easy it makes it to commit
fraud.

This guy should have read the rules and followed them. If he's not willing to
do that, then the decision to end the relationship with him makes sense.

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geofft
> _You can 't have fraud judged arbitrarily or allow anything regardless of
> how easy it makes it to commit fraud._

Why not, exactly?

Whatever rules you set up, you'll have false positives and false negatives.
Some people will figure out how to do illegitimate things without being
noticed by the rules. And some people will find the rules too burdensome and
fail to do legitimate things aligned with the program's goals.

There is an old proverb in law: Better that ten guilty persons go free than
that one innocent person is punished.

It might serve the program's goals better to decide, we're willing to allow
some amount of fraud in order to make sure the program functions smoothly and
people don't get trapped by rules, or we're willing to allow some amount of
fraud because the cost of enforcement outweighs the fraud itself. (Major
retailers work like this, for instance; they budget in some amount of expected
shoplifting, because it's cheaper than both increasing security and
potentially scaring off customers with increased and hostile security.) It
might also _not_ serve the program's goals better, and you want to take a hard
line at the risk of blocking legitimate use. But it's not obvious the latter
is the right approach.

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stretchwithme
Because we live in a democracy and everyone has access to the court system and
you don't want to be in court all of the time. This program is funded by the
taxpayer, after all.

And, yes, rules aren't perfect. But you can keep improving them as you learn
more. And that leaves you with, yet again, a set of rules.

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protomyth
If the author really cared about the root problem of why someone would run a
credit system, perhaps they could have looked at the once a month payment
system that EBT uses and what ramifications that has. Take a quick look at
places that accept EBT and notice what specials they have on the first of the
month as opposed to the rest. Notice any police checkpoints that only seem to
get setup on the first? Notice where they are? Go into a local Walmart on the
morning of the first day of the month and observe. Look at EBT related signs
especially in gas stations that accept EBT (check the microwave).

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occamrazor
Could you expand on your comment, for the benefit of readers like me who don’t
live in the US? What happens in Walmart on the first day of the month?

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protomyth
Walmart accepts EBT and has cheap groceries. So, when the EBT refreshes you
get quite the crowd there. A lot of money gets spent. For folks not going to
Walmart, it is interesting to see what is on sale or what never goes on sale
at the first of the month.

Now, the interesting thing is since Walmart is such a destination, you will
find some interesting policing in some communities. I would love someone to do
an actual study on who gets tickets at what times of the month. After all,
kicking people when they are down is pretty safe.

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michaelaiello
Let's look at this from the user perspective.

Grocery store 1: No credit option, must have a positive balance on my EBT
card.

Grocery store 2 (P&L Deli Grocery) flexible credit option, able to take a loan
out while waiting for EBT card to get replenished.

As a customer, which one of these two offerings is better?

#2 is clearly a better grocery store. It is a grocery + lender for those on
EBT cards!

The EBT system (and, likely every other credit card / merchant processor) bans
informal credit because there is no basis of control or audit-ability on these
kinds of transactions.

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captain_perl
For those confused by the use of the word "fraud" here, the US government
today considers fraud to cover both financial misdeeds, as well as (their)
rules violations where no money is involved.

If you follow the news, you'll see the word "fraud" increasingly thrown around
as it gives the government a bigger hammer to use on its citizens.

Meanwhile, actual fraud like civil asset forfeiture rolls along with full
government endorsement.

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EdwardDiego
Food stamps are a fantastic way of infantilizing grown adults.

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krapp
I've encountered plenty of food stamp recipients, including my own parents
when I was younger, and I've yet to see someone be "infantilized" by the
ability to afford food.

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vuln
I guess what's considered food is up to opinion. I've seen countless people
using food stamps for energy drinks and chips. While paying cash for their
lotto and cigarillos.

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learc83
How closely do you pay attention to people's payment method? An EBT card looks
pretty much like a debit card. I definitely don't pay enough attention to
notice what bank the person in front of me in line is using.

I suspect that unless you're working as a cashier, "countless people" is an
exaggeration, and even if you are it's likely confirmation bias.

