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A roadmap to preventing government benefits fraud and elevating beneficiary satisfaction

Benefits fraud costs U.S. taxpayers billions each year. Here’s how states can fight it.

Government aid is a lifeline to millions of Americans. These payments deliver critical support through benefit programs such as nutrition assistance, unemployment insurance, child support, and relief to people in need following disasters and other emergencies.

Vulnerabilities in these systems, however, cost taxpayers billions of dollars and impede the safe, quick delivery of funds to those who most need them. For example, although exact figures are difficult to quantify, the U.S. General Accounting Office estimates that unemployment insurance fell prey to between $100 billion and $135 billion in fraud during the COVID-19 pandemic.

What’s driving benefits fraud?

Government payment programs are complex and governed by regulations, eligibility criteria and administrative processes. Because the scale of government payments is so large, it’s often difficult for state and federal agencies to detect fraudulent activities and deploy adequate oversight mechanisms — especially with limited funding and resources.

Beyond the sheer complexity of these programs, three primary technological and security weaknesses continue to put agencies, taxpayers and vulnerable populations at risk:

  1. Magnetic-stripe EBT cards that do not use chip technology can allow bad actors to gain unauthorized access to funds, leading to fraudulent transactions and misuse of benefits.
  2. Selection of PINs that are easy to guess (e.g., 1234) make accounts more vulnerable to unauthorized access.
  3. Identity theft vulnerabilities compound these issues, as fraudsters exploit weaknesses in identity verification processes to impersonate legitimate beneficiaries and siphon off funds.

For agencies, addressing these technological and security gaps is crucial to safeguarding against fraud and ensuring the effective delivery of benefits.

An agency’s guide to preventing benefits fraud

With decades of experience servicing government payments, including supporting approximately 40% of SNAP payments and more than 23 million Medicaid and CHIP beneficiaries, Conduent’s Government Solutions experts maintain a blueprint to help our clients combat fraud and deliver the best possible outcomes for their constituents. Our teams keep pace with emerging technologies and tools to identify and prevent fraud attempts.

Based on our experience, effective fraud prevention is based on six critical foundations of service delivery:

  1. Modernized EBT cards to include EMV chip technology
    Transitioning from traditional magnetic stripe-only payment cards to EMV chip-enabled cards will enhance security and help thwart ATM card skimming.
  2. Empowered recipients
    Allowing constituents greater access and flexibility has proven effective in reducing fraud. For example, our EBT account lock/unlock feature using the ConnectEBT app is now used in states including South Carolina, Maryland, New York, Iowa and Ohio, making it much harder for unauthorized users to access SNAP and other assistance.
  3. Enhanced PIN security
    Conduent can implement new “Soft PIN” restrictions for cardholders to combat common PIN-based fraud. These restrictions prevent fraudsters from exploiting easily guessable PINs.
  4. Advanced IVR technology
    Interactive voice response (IVR) technology analyzes call patterns to identify and block suspicious phone numbers, while helping investigators locate and prosecute perpetrators.
  5. Real-time transaction monitoring
    Working with states, beneficiaries can set up and receive usage alerts for their accounts, signaling transactions. This real-time monitoring allows consumers to spot and report suspicious activity promptly.
  6. Robust identity verification
    Identity verification and bank account ownership validation provide added security and help ensure benefits reach their intended recipients.

Powered by teams of dedicated experts, federal and state agencies provide vital resources to families and those in need. These professionals must stay ahead of the fraud curve to protect both their efforts and taxpayers from increasingly sophisticated efforts to steal these vital resources.

At Conduent, we remain a proud partner in advancing secure, fast and effective government payment solutions for our clients.

Ready to discover why Conduent Government Payment Solutions are trusted to provide electronic payments in 36 states and manage approximately 40% of U.S. SNAP payments? Reach out to our experts now by visiting