EBT theft is a multi-million dollar problem for California. Many benefit recipients and taxpayers are asking when new safety measures will be implemented.
SACRAMENTO, Calif. — Theft related to electronic benefits transfer cards, also known as EBT cards, is a major problem in California.
The state deposits money into these EBT cards each month for eligible recipients of food and cash assistance programs. This program is administered by the California Department of Social Services. Taxpayers are scrambling to recover stolen benefits.
According to CalMatters, California was losing taxpayers about $10 million per month to EBT theft in 2023. Benefits were often repeatedly stolen.
In 2023 alone, Sacramento County paid back more than $12 million to people who had their EBT benefits stolen.
“In January 2024 alone, nearly $200,000 was fraudulently withdrawn from seven locations,” said Detective Sean Smith of the Sacramento County Sheriff's Office.
He points out that organized crime syndicates profit from EBT theft.
“We've had dozens of reports coming in, all related to skimming,” Smith said.
The most common type of theft in Sacramento County is skimming. That's when someone inserts a device at a grocery store, gas station, or bank and captures the cardholder's information.
Several ABC10 viewers contacted the “To the Point” team and asked why the state hasn't implemented chip-and-tap technology with EBT cards. I asked the California Department of Social Services.
According to CDSS, federal regulations direct states to only use EBT cards with magnetic stripes. “The federal EBT system was designed with fixed requirements that limited card technology to magnetic stripe transactions only,” the department said in a statement to ABC10.
This means that changing the EBT card system would require federal intervention.
The second reason requires significant changes to the current EBT system infrastructure, the ministry said, adding that EBT transactions are processed differently than commercial credit and bank cards. Without back-end technology upgrades, “transactions using chip/tap EBT cards will fail.”
Currently, no states issue EBT cards with chips. California is spending $50 million to update its regulations and be an early adopter of chip and tap technology.
The ministry says implementation of AB10 chips and tap cards is scheduled for summer 2024.
California is not alone in dealing with EBT theft. Oregon Sen. Ron Wyden and other lawmakers recently introduced a bipartisan bill. If passed, the bill would require new EBT cards nationwide to include a chip in two years. All old cards must be reissued with a chip within five years. The U.S. Department of Agriculture would be directed to provide funding to assist states making the transition.
See more ABC10: Millions of taxpayer dollars stolen from EBT cards | What we know
