I-Team exposes fraud within Wisconsin's FoodShare program
Jermont Terry, Tim Meulemans
Photo: Video by tmj4.com
MILWAUKEE - The Foodshare program pumps more than a million dollars into Milwaukee each day. It's supposed to only provide food to the hungry.
In Wisconsin, recipients are issued a Quest card. The card is basically foodstamps for the digital era, a credit card you can use at stores approved by the USDA to buy food.
But the I-TEAM discovered fraud within the system, and you paid for it.
The I-TEAM has been on exposing stores that are supposed to provide nutritious food for families who can't afford it.
Instead, our hidden camera uncovered stores that had hardly any food or stores that never opened. They were all Quest approved vendors.
The USDA claimed its system is virtually fraud free. It said one percent is reported.
"The fraud in this program is there. You don't have to be a rocket scientist to see that," said Milwaukee County Sheriff David Clarke.
Now, the I-TEAM uncovered a man charged with stealing nearly $1 million of your money.
John Sedrick Williams is accused of pretending to sell frozen steaks to the homeless, but instead, he allegedly collected Foodshare dollars in exchange.
That's not the worst part.
What's truly shocking is that the USDA was warned two years before it took action.
"You have a situation here where you know someone is doing something wrong and they are looking a blind eye to it," said State Representative Samantha Kerkman.
The Republican state representative from Kenosha saw what she believed to be fraud, so she asked for an audit of the Wisconsin Foodshare program.
"We need some action at the federal level. I really do believe that. We can make some changes at the state level, but until we get the federal government as a partner in this issue, our hands are tied," said Kerkman.
In the current system, the state can only police recipient fraud.
That's despite the fact Wisconsin has added investigators, recovered millions and have gotten much better at spotting fraud.
It's extremely hard for them to touch the stores cheating the systems.
"Unfortunately, with the federal government, you have to bring specific examples and I don't know...you have to knock on their door and keep knocking on their door," said Kerkman.
The I-TEAM knows first hand. We've been knocking on that door for months.
We've tried to get someone with the USDA to sit down and talk with us about the problems within the program.
Instead, all we get are statements like this:
"USDA has a zero tolerance policy when it comes to fraud. We will continue to work aggressively with our local, state and federal partners to hold bad actors accountable," said USDA Food, Nutrition and Consumer Services Under Secretary Kevin Concannon
That's the only response we got after the USDA disqualified two stores as Quest vendors.
Among them: Sticky Fingers Candies.
It was an approved vendor even after the city denied its food license and shut them down. No one there was charged with a crime.
The I-TEAM recorded hidden video in February 2013 at S&R Tobacco.
It's an approved Quest Vendor, but the shelves were bare just as they were when the I-TEAM first busted this business back in November 2012 for not meeting nutrition requirements.
That brings us back to John Sedrick Williams.
On paper, Williams said he owned and operated at truck that sells boxes of premium steaks door to door all over Southeast Wisconsin.
According to a federal complaint, Williams only drove a 10 block stretch of downtown Milwaukee.
He allegedly only sold to people with Quest cards and almost all of them were homeless.
The complaint said Williams drove his luxury SUV as his work truck, and that he didn't actually sell anything.
He's accused of taking a person's quest card, swiping it through the card reader provided by the USDA and splitting the cash.
"If you don't have constant oversight over these billion dollar programs, you're going to have waste, fraud and abuse," explained Sheriff Clarke.
There was some oversight.
According to the complaint, the state warned the USDA about Williams twice in June of 2011.
However, investigators said the USDA sent Williams two more card readers.
Five months after that, Williams was busted and charged with Foodshare fraud.
"It's a big bureaucracy. I go by people's actions, not their words." said Clarke.
In Williams' case, the dollar amounts are staggering.
According to the complaint, tens of thousands of dollars were collected each month for a year and a half. This happened all after the state warned the USDA.
It was a total of nearly $800,000 before he was finally stopped.
The I-TEAM stopped by Williams' Fox Point house, but he didn't want to talk to us.
Sheriff Clarke said the current system does not have enough oversight.
Clarke wants a local task force, paid for with money saved by catching Foodshare crooks.
He believes the program is needed, but so is its integrity.
"You can't put a price tag on public confidence," said Clarke.
Just before our story aired, the USDA got back to the I-TEAM in regards to Williams' case.
It now said it has been working with the sheriff's office investigating the accused thief for the past year.
Williams' case is still working its way through the federal court system.