Welfare Benefits Being Withdrawn at Strip Club
ATMs. In
a follow-up story to an investigative story cited in last week's Cal-Taxletter,
the Los Angeles Times reports that
welfare recipients withdrew $12,000 in cash from the Temporary Assistance for
Needy Families program from ATMs in strip clubs throughout the state between
2007 and 2009.
The California
Department of Social Services said the governor has ordered the department to
correct the problem by removing strip clubs and casinos from the list of
businesses where recipients can withdraw taxpayer dollars. In an e-mail
to the Times, department spokeswoman Lizelda Lopez said: "We'll take a wide-ranging look
and apply some common sense to the list of outlets where cash assistance should
not be withdrawn."
The Times earlier reported that welfare recipients have been withdrawing cash benefits at ATMs in casinos and cardrooms. The state has now calculated the amount of money that has been withdrawn from the state's welfare program using ATMs located in casinos: $1.8 million in just eight months (October 2009 through May 2010). (Source: Los Angeles Times, June 30.)
Cal-Tax recommendation: Kudos to the Los Angeles Times for revealing that cash welfare benefits are being withdrawn at casinos and strip clubs, where much of the cash probably remained. The state needs to find a better way to help those who truly need assistance, and to stop giving cash to those who are using it for extracurricular activities. The governor's orders are a step in the right direction, but welfare recipients can get around the orders by simply stopping at other ATMs on the way to the casino or strip club. More safeguards are needed.
Cal-TaxReports, July 6, 2010
© 2010 California Taxpayers'
Association.
All Rights Reserved.