Child Care Fraud Allegations – Not Child’s Play

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Most parents share a common need? child care. But while the need for the service may be the same, parents’ ability to pay for it may differ dramatically. In fact, some parents are caught in a bind – they need to work, but they can’t afford child care, unless they have help. That’s where government programs often enter the picture. And, as we’ve seen with ”Fraud of the Day,” if there is a government program involved, there also is the potential for fraud.

Today’s fraud from the Post-Tribune focuses on allegations of child care fraud by an Indiana daycare owner. In 2005, the daycare owner reportedly began participating in the Indiana Family and Social Services Administration’s (FSSA) Child Care and Development Fund, a program that ”provides child care to help low-income families.’? (So far, so good.? Here’s how the benefit works? ”The program gives cards to the families they are supposed to swipe each time they take their child to a day care center. The card keeps track of how many children with the program go to the day care and how often, then reimburses the day care provider.”

An indictment alleges that from 2007 to August 2011, she led a scheme to defraud the program of up to $120,000. (Now, we have a problem.? ”Mothers would fill out an application for the program using false information about how much they worked.’? (That would take parent-teacher relationships to a whole new level.? Once in the system, the mothers would then allegedly provide their cards to the defendant and she ”could then swipe the cards for children she never actually watched.’? The defendant ”pleaded not guilty” to the charge.

It is critical to keep in mind that the defendant, as in all cases, is innocent until proven guilty. That said, agencies can learn from the allegations of fraud detailed in the article and the indictment. So, here’s the question of the day? what type of controls and oversight are in place in child care programs in your state to prevent fraud?

Source: Today’s ”Fraud of the Day” is based on an article entitled, ”Gary Daycare Center Owner Indicted for FSSA Fraud,” written by Teresa Auch Schultz and published by the Post-Tribune, March 15, 2012.

The owner of a Gary day care center is accused of defrauding the Indiana Family and Social Services Administration out of $120,000, according to an indictment filed Wednesday in U.S. District Court in Hammond.

Kimberlyn Cross faces one count of wire fraud, which she pleaded not guilty to during a Wednesday hearing. Her attorney, Scott King, said she been released and he would review the case during the next few weeks.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.