PRESS RELEASE

June 10, 2004

EFF files federal complaint against DSHS

OLYMPIA – The Evergreen Freedom Foundation (EFF) today filed a complaint against the state's Department of Social and Health Services (DSHS) for violations of federal law. The complaint was sent to the U.S. Department of Health and Human Services, the U.S. General Accounting Office, and the U.S. Western Washington District Prosecuting Attorney.

At issue are recent audit findings against DSHS regarding day care fraud in the city of Mattawa, Washington. In these audits, the State Auditor found:

• DSHS...does not perform any procedures to verify that the correct SSN [Social Security Number] has been provided or that an applicant has supplied his or her real name.

• All providers billed the Department for services that they could not document they provided. We estimate that $2 million in federal Child Care Development Funds was paid to these 50 providers during the periods reviewed. In addition, most providers have not yet corrected all of the deficiencies cited in this report but continue to receive child care payments from the Department.

• Some in-home providers did not provide accurate and complete information on the Criminal History and Background Information form. One provider had a 1997 felony warrant that was not identified during the application process. This provider is still licensed and operating as child care provider.

• This condition occurred because the Department's procedures for criminal history and background inquiries are inadequate. The applicant is not required to provide a SSN on the background inquiry form and this number is not used during the review. The Department uses only the name and address of the applicant to perform a background check. When the SSN is available to the Department, it does not verify the validity of the number or conduct a nation-wide background search using this information.

• This condition creates a risk that the Department may not be aware of a person who could pose a potential danger to the children placed in the care of this provider.

As a result of these audit findings, the State Auditor requested DSHS to "forward evidence in this case to the Grant County Prosecuting Attorney's Office for any action deemed appropriate under the circumstances."

Despite initially cooperating, Grant County law enforcement, as recently as this morning, indicated that DSHS is now frustrating their efforts to initiate necessary prosecutions for these violations of state and federal law by not providing all requested records.

"It isn't our desire to prosecute people because they are taking advantage of the system DSHS has made readily available to them," Grant County Sheriff Frank De Trolio told EFF. "Our whole intention in this process is to stop payments to those individuals not entitled to taxpayer money."

Because of the seriousness of these audit findings and the accusations of Grant County law enforcement, EFF last week informed DSHS that, unless the requested documents were turned over to Grant County by June 9, EFF would be filing a formal complaint with the federal government against the agency.

"It is unfortunate that DSHS has chosen to engage in this obstructionist behavior," said Bob Williams, president of EFF. "One has the expectation that state agencies would willingly cooperate with law enforcement so lawbreakers can be brought to justice. Since this is not the case, and since the legislature has not held DSHS accountable for their numerous violations, we are now being forced to seek federal relief."

"It isn't fair to the taxpayers that cuts to services are happening while the state is sending illegal payments to individuals committing fraud," said De Trolio.

"Remember, this is potentially $2 million worth of fraud in one small town! Imagine what else is out there," said Williams.

Additional Information

EFF's June 10 federal complaint
EFF's June 2 press release - DSHS flouts the law...again

Contact: Jason Mercier | Budget Research Analyst | 360.956.3482

Evergreen Freedom Foundation P.O. Box 552, Olympia, WA 98507 Phone: (360) 956-3482, Fax: (360) 352-1874 Email: effwa@effwa.org