CapCon reporting on SNAP fraud leads to statewide card upgrade

Michigan’s food stamp program will have a higher level of security starting Jan 1. The program, which benefits 1.4 million people, will be reformed with newer and more secure Bridge Cards, a move that follows a months-long Michigan Capitol Confidential investigation noticed by the Michigan House Oversight Committee.

Banks switched their credit and debit cards from magnetic-stripe to chipped versions starting in 2015. But the state of Michigan didn’t upgrade its technology, and criminals have abused that vulnerability.

The state’s failure to reform the cards allowed scammers to steal $14 million Michigan’s poorest residents as of 2024, CapCon reported. In 2024, the Michigan Department of Health and Human Services sent more than 269,000 replacement Bridge Cards, an average of 738 every day.

CapCon has spent more than $1,000 paying for public records that exposed widespread fraud within the state’s largest department, which administers the food stamp program in Michigan. Just this year, Michigan will have to repay $415 million to the federal government because it bungled benefits.

Equipping Bridge Cards with chips will save taxpayers money and might improve the state’s error rate, Rep. Jason Woolford, R-Howell, told CapCon in a text message.

"By adding chip technology to Bridge Cards, we are strengthening accountability and reducing opportunities for fraud and abuse,” Woolford said. “This upgrade ensures that every dollar of taxpayer support is used as intended, helping Michigan families in need and protecting the integrity of our assistance programs. I am glad the work we have done in Oversight is driving real improvement in how taxpayer money is distributed. These changes could also help improve the state's error rate and save taxpayers hundreds of millions of dollars over time."

The Department of Health and Human Services, which has about 16,000 employees, hasn’t responded to many requests for comment during this investigation. CapCon has published 15 stories on this issue over two years.

No other outlet but CapCon exposed rampant fraud and abuse in Michigan’s SNAP program.

1. Michigan faces $415M bill for botched benefit errors

2. Michigan food stamp fraud spiked nearly 400% from 2023 to 2024

3. Michigan fails to protect food benefits for 1.4M residents

4. Michigan welfare fraud doubled from 2023-2024

5. Michigan House approves adding chips to SNAP cards

6. Criminals hijack IDs to pose as grocery stores in food stamp scam

7. A tale of two Michiganders

8. Michigan paid more in fraud than it would cost to fix Bridge Cards

9. SNAP fraud skyrockets as Michigan sends 738 new Bridge Cards a day

10. Fake card readers, real damage: Inside Michigan’s EBT crime campaign

11. Food stamp fraud is ‘devastating’ Michiganders, document says

12. Michigan faces $890M bill looming for food stamp program

13. Criminals loot Michigan’s $250M monthly food benefits system

14. State worker fired after reporting SNAP theft scheme

15. Michigan’s outdated food stamp cards cost poor families $846K in stolen benefits

Haywood Talcove, the CEO of LexisNexis Risk Solutions, was an important source for CapCon’s reporting on food stamp fraud.

“The state of Michigan deserves credit for taking an important first step toward strengthening the integrity of its benefits system,” Talcove said. “Adopting chip-enabled Bridge cards is a smart move to reduce some forms of fraud, but the threat landscape has evolved well beyond card technology. Michigan must now focus on stopping unauthorized retailers, cloned point-of-sale devices, trafficking schemes, and online EBT fraud.”

Talcove, whose company sells anti-fraud software and services to banks and unemployment agencies, said the state must keep protecting taxpayers by stamping out fraud.

“With roughly $2.5 billion in annual benefits and an improper payment rate over 10%, the cost of inaction is enormous for taxpayers — nearly $400 million a year in losses. Under the ‘One Big Beautiful Bill,’ states will now be held financially accountable for improper payments, facing penalties of up to 25% (of the cost of benefits) if they fail to address the problem. Michigan’s early action is a positive step, but sustained modernization and enforcement will be essential to protect taxpayers and ensure benefits reach those who truly need them.”

CapCon is still waiting on the state health department to produce records about internal fraud. We will continue to report on food stamp fraud as more information becomes available.