Catching Double-Dealers

They include teachers and policemen, postal workers and bus drivers, health-lab technicians and jail keepers, IRS and Secret Service clerks. All are on a public payroll--and all have connived to be simultaneously on the public dole. Last week, in the latest crackdown against a special breed of welfare cheater, 164 civil servants in Chicago and New York City were indicted for double-dealing an extra slice of the taxpayers' pie. Said U.S. Attorney Sam Skinner in Chicago: "The problem is immense. There is an astonishing lack of respect for law from public employees. We rest our whole Government on integrity, and I consider this to go to the very foundations of our Government."

In New York, nearly 1,000 indictments have been handed down in six months naming employees in some 40 government agencies who allegedly skimmed $4 million off the welfare system. During the past two years, the U.S. Attorney's office has indicted 320 government employees in Michigan.

In Chicago, 92 charged with mail fraud and giving false statements to welfare officials have bilked the public out of nearly $1 million. On the average, they were said to be on the take for more than three years. The purported record holder was a man who had illegally been on welfare for a decade. The Government claims one individual swindled $17,500 during a two-year period, but the mean grab for the 92 was put at $210 a month, or slightly more than $2,500 a year.

Two Cars. The legal incomes of those charged with fraud in New York and Chicago vary. In the Big Apple, the range was from $7,000 to $12,000 a year; in Chicago, the average salary of the indicted came to $11,978--and a dozen made more than $15,000. One man drove two cars--a 1977 Monte Carlo and a 1976 Charger. Another had a master's degree, earned $15,000 a year and had stashed $20,000 in a bank. Many of those indicted held charge cards from some of the city's best stores; some had BankAmericards. Attorney Skinner cites the most frequent excuse by those indicted: "I needed the money." Fumes Skinner: "They need it! We all need it."

How does the scam work? Most of those indicted at one time had no jobs and legitimately received welfare payments. But after they were hired by federal, state or local government agencies, they left themselves on the welfare rolls. Since welfare recipients are regularly asked to fill out personal-status forms, the specific fraud usually entailed falsifying employment information.

Simple Task. The cheaters escaped detection for so long because--the bureaucracy being what it is--no one was thoroughly checking the lists of those getting welfare against the lists of those on public payrolls. In the early 1970s that relatively simple task was begun by federal and local computers, and the search is now paying off. In Chicago, a task force of 60 investigators will soon start reviewing 4,500 more suspicious cases that have been identified by the computer process. Working closely with local officials, federal inspectors are conducting or planning to start similar investigations in other major American cities, such as Philadelphia, Boston and Washington.

So far, nearly all the double-dealers who have been tried have been found guilty and have received prison terms of up to five years and light fines. The guilty will be automatically fired from their jobs--raising the ironic possibility that they may have to go on welfare legitimately when they finish their prison terms. With that dismal prospect looming ahead--and the implacable computer going over the records--several welfare cheaters have already called the Illinois department of public aid. They wondered if everything would be all right if they just paid back the money.

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