BILL NUMBER: S8662A
SPONSOR: FELDER
 
TITLE OF BILL:
An act to amend the social services law, in relation to requiring elec-
tronic benefit transfer systems to include fraud detection for unauthor-
ized transactions
 
PURPOSE:
To implement a system to prevent EBT benefit theft.
 
SUMMARY OF PROVISIONS:
Section 1 amends subdivision 1 of section 21-a of the social services
law by creating an option for ebt beneficiaries to lock or unlock their
card via a Interactive Voice Response System (IVR) and to specifically
lock their card for out-of-state or online purchases.
 
JUSTIFICATION:
Increasingly sophisticated fraud and theft schemes targeting Electronic
Benefit Transfer (EBT)recipients have grown to alarming levels affecting
large populations of beneficiaries. Despite the recognition of these
schemes costing taxpayers millions of dollars little has been accom-
plished to proactively prevent these thefts.
While major bank and credit card companies have implemented various
protections to combat the increasingly elaborate scams, EBT has lagged
behind. Fraud detection systems are crucial for protecting the individ-
uals who depend on Supplemental Nutrition Assistance Program (SNAP)
benefits, protecting the. taxpayers who fund these programs and allevi-
ating pressure on agency personnel. By instituting a verification mech-
anism when transactions are initiated out-of-state, New York would be
showing progress in ensuring the most vulnerable among us are not fall-
ing victim to these schemes. It would provide a valuable safeguard for
the finite amount of funds recipients have to feed their families.
 
PRIOR LEGISLATIVE HISTORY:
New bill.
 
EFFECTIVE DATE:
This act shall take effect six months after it shall become law.