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The State of Louisiana Takes a Bite Out of Illegal Food Stamp Traffic

  • July 01 2004, 1:00am EDT

REVIEWER: Duane Fontenot, director of IT for the Louisiana Department of Social Services.

BACKGROUND: The Louisiana Department of Social Services (DSS) is responsible for developing and providing social services and improving social conditions for the citizens of Louisiana. The DSS offers a federal/state program called the Food Stamp Program, which is designed to help low-income families buy the food they need for good health.

PLATFORMS: Wintel platform, Windows 2000 Server and WebFOCUS on the IBM Mainframe UNIX System Services.

PROBLEM SOLVED: More than 600,000 people in the State of Louisiana receive food stamps each year, representing approximately $600 million in U.S. Federal funding. Unfortunately, experts estimate that at least four percent of those funds are fraudulently received or trafficked. Trafficking in food stamp benefits, also known as discounting, is usually a case of food stamp recipients selling their benefits to dishonest grocers for cash rather than food. The grocers pay the recipient considerably less than the face value of the stamps and then pocket the difference. With millions of transactions occurring over a large geographic area, detecting patterns of fraudulent activity can be difficult. To help reduce this illegal activity, our agency needed a way to track people who are taking advantage of the system. This required a powerful business intelligence tool to analyze trends among millions of transactions to detect fraudulent activity.

PRODUCT FUNCTIONALITY: Information Builder's WebFOCUS has helped us with a successful investigation that involved numerous dishonest retailers and food stamp recipients in the New Orleans area. Using WebFOCUS, we were able to establish relationships, trends and patterns within the data to help us identify the fraudulent activity. With WebFOCUS as the primary reporting tool, we have a tool for both real-time and staged reporting. Now food stamp transaction data is loaded into a data warehouse that allows field investigators to easily access and mine information about transaction amounts, times and locations. Incorporating geographic information into the system extended our fraud detection capabilities even further. Geocoding information correlates specific names and addresses to locations by displaying the data on the map. The map visualization helps us quickly peruse anomalies in the data so we can make well-informed decisions. This literally provides a clear picture of suspicious activities. The chief benefit of WebFOCUS is having the tools to make well-informed decisions rapidly and accurately while eliminating a lot of effort by the data processing personnel. It is now possible for us to generate accurate reports more quickly and mine data in ways that previously could not be done.

STRENGTHS: The main strengths of WebFOCUS include the visualization capabilities and the overall accuracy in detecting fraudulent activity. The map visualization gives us the ability to see the data displayed geographically with trends of fraudulent activity graphically represented. The data speaks very loudly and clearly with this system, making it much easier for us to investigate.

WEAKNESSES: The graphical interface could to be more intuitive and fully featured.

SELECTION CRITERIA: We considered Crystal Reports and BusinessObjects, but ultimately selected WebFOCUS because of the powerful analytical features, data warehouse suite of products and the bidirectional GIS interface.

DELIVERABLES: Information Builder's WebFOCUS makes it possible for Louisiana's Department of Social Services to generate reports that reveal the average number of transactions per client in the state. Once that data is displayed geographically on the map, we can hone in on particular regions simply by drawing a circle around a certain part of the map. The system knows which customers and stores are within that circle and displays the data accordingly. The technology enables users to establish relationships, trends and patterns within the data to help identify fraudulent activity. Bottom-line ROI is also important, and with at least four percent of $600 million being fraudulently received every year, the system will more than pay for itself when the department reduces illegal activity by even a small fraction of one percent.

VENDOR SUPPORT: The support we received from Information Builders was excellent. They took the time to understand the specific needs of our department and developed a system that has exceeded our goals. Although we haven't needed much additional support, Information Builders has been quick to respond to any questions.

DOCUMENTATION: The documentation was comprehensive and easy to understand.

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