Report 2015-503 Recommendation 7 Responses

Report 2015-503: Follow-Up—California Department of Social Services: It Has Not Corrected Previously Recognized Deficiencies in Its Oversight of Counties' Antifraud Efforts for the CalWORKs and CalFresh Programs (Release Date: June 2015)

Recommendation #7 To: Social Services, Department of

Social Services should track counties' prosecution thresholds for welfare fraud cases and determine whether they affect counties' decisions to investigate potential fraud, with a focus on determining best practices and cost-effective thresholds. If Social Services' analysis determines that varying prosecution thresholds do affect counties' decisions, it should then work with counties to implement the consistent use of these cost-effective prosecution thresholds.

Annual Follow-Up Agency Response From November 2020

Will not implement, and recommend closure of the issue for the following reasons:

CDSS has always valued and respected CSA's recommendation to focus on mandated processes to investigate potential fraud and agrees processes should be in place to ensure welfare fraud is pursued if there is a failure to meet prosecution thresholds. CDSS has not been able to use prosecution thresholds alone as a mechanism to make sure all cases are prosecuted or routed through the Administrative Disqualification Hearing (ADH) process. Instead our focus has been to expand the use of the ADH process for counties to use when a case does not meet prosecution thresholds or evidentiary standards. This has been achieved through a combination of county letter guidance, ADH training, and regular SIU Reviews. Our most recent efforts include the attached Separation of Duties guidance letter which strongly suggests that all cases be prosecuted or referred for administrative disqualification. In addition, and also included, our training in schedule in 2019 which included ADH training in Asilomar, August 7-9. 2019. During our SIU review process, if a county is found not to be utilizing the ADH process when necessary, a finding is issued to the County's Director, and corrective action is mandated. CDSS has chosen these methods versus focusing our efforts on prosecution thresholds as it serves the same purpose that all cases should either be prosecuted or sent for an administrative disqualification hearing if evidence of fraud has been determined.

California State Auditor's Assessment of Annual Follow-Up Status: Will Not Implement

Social Services' response essentially describes its existing practices, rather than practices that would alleviate the need for our recommended change.

Annual Follow-Up Agency Response From November 2019

Will not implement. No change to previous response.

California State Auditor's Assessment of Annual Follow-Up Status: Will Not Implement

Annual Follow-Up Agency Response From November 2018

CDSS' system for tracking county prosecution thresholds for welfare fraud cases is in full compliance with a federally mandated process that requires all cases either be prosecuted, and if not prosecuted, routed through the Administrative Disqualification Hearing (ADH) process (Title 7, California Code of Regulations (CFR) 7CFR 273.16.

California State Auditor's Assessment of Annual Follow-Up Status: Will Not Implement

This recommendation has been outstanding since the release of the original audit in November 2009. We are disappointed that Social Services has chosen not take our recommendation seriously and use it to improve its oversight of counties' anti-fraud efforts.

Annual Follow-Up Agency Response From December 2017

Disagree with recommendation.

California State Auditor's Assessment of Annual Follow-Up Status: Will Not Implement

Annual Follow-Up Agency Response From November 2016

See response to Recommendation 4.

California State Auditor's Assessment of Annual Follow-Up Status: Not Fully Implemented

1-Year Agency Response

Counties are mandated to make a fraud referral for investigation regardless of any prosecution threshold (MPP Section 20-005.1). Therefore, counties' prosecution thresholds cannot affect counties' decisions to investigate potential fraud.

California State Auditor's Assessment of 1-Year Status: Will Not Implement

Social Services cites its own policy manual when indicating that counties are mandated to make a fraud referral regardless of any prosecution threshold. Our recommendation is asking Social Services to re-evaluate this policy and potentially establish prosecution thresholds based on fraud totals that are cost effective to pursue. Instead of gathering information to evaluate the feasibility of this potential approach, Social Services simply reiterates its existing policy.

6-Month Agency Response

Social Services reasserts its position that there is no direct relationship between a prosecution threshold and counties' decision to investigate welfare fraud. As the Department has explained previously, counties have an obligation to make a fraud referral for investigation regardless of any prosecution threshold.

California State Auditor's Assessment of 6-Month Status: Will Not Implement

Similar to its previous response, this response by Social Services is supposition. Our recommendation is for Social Services to analyze actual county practices in order to determine whether or not counties' prosecution thresholds affect counties' decisions to investigate potential fraud.

60-Day Agency Response

See initial response.

California State Auditor's Assessment of 60-Day Status: Will Not Implement

Social Services reasserts that there is no direct relationship between prosecution thresholds and counties' decisions to investigate welfare fraud. However, and as we explained in our comments on the initial response that Social Services provided in the follow-up audit report, Social Services has not taken any action to track how counties determine prosecution thresholds and the effects those thresholds on counties' decisions to investigate potential welfare fraud. We continue to expect Social Services to demonstrate the presence or absence of this effect through an analysis of actual county practices, rather than through supposition.

All Recommendations in 2015-503

Agency responses received are posted verbatim.