Library: Policy

340:65-9-4. Fraud

Revised 9-17-18

(a) Fraud definition. Per Section 185 of Title 56 of the Oklahoma Statutes (56 O.S. § 185), fraud in obtaining public assistance occurs when a person:

(1) obtains or attempts to obtain, or aids, abets, or assists any person to obtain, by means of a false statement or representation, by false impersonation, by a fictitious transfer, conveyance or encumbrance of property or income, by a knowing and willful failure to report to the Oklahoma Department of Human Services (DHS) income, personal property, real property, household members, or other material eligibility factors at the time of application or during the receipt of assistance, or by other fraudulent device, assistance to which an applicant is not entitled or assistance greater than that to which an applicant is justly entitled; or

(2) by sale, barter, purchase, theft, acquisition, possession or use of any electronic benefits or debit card or any other device authorizing participation in the Temporary Assistance for Needy Families (TANF) or other DHS program, knowingly obtains, aids, abets, or assists any person to obtain or attempt to obtain assistance to which a person is not entitled.

(b) Fraud penalty. The penalty for fraud is set forth in 56 O.S. § 185. Per statutes, only courts can determine guilt and impose a legal penalty for fraud.

(c) Office of Inspector General (OIG) referral by AFS BIR staff. Adult and Family Services (AFS) Benefit Integrity and Recovery (BIR) staff may refer household error overpayments of $500 or more to OIG to determine if a referral for judicial court action is warranted.

(d) OIG referrals by workers. Workers use Form 19MP001E, Referral Form, to make an investigative referral to OIG when they suspect fraudulent intent, but there is insufficient information to calculate an overpayment or the referral involves a state employee and/or his or her relatives.

(e) OIG findings. OIG staff submits findings to AFS BIR for final overpayment calculation and establishment of the overpayment. When OIG returns the overpayment to AFS BIR and a fraud determination is not made per (f) or (g) of this Section, the AFS BIR staff proceeds to collect the debt.  • 1

(f) Fraud determination for State Supplemental Payment (SSP) overpayments. For SSP, a fraud determination is made when the local, state, or federal court official agrees to pursue judicial prosecution and the court finds the debtor(s) guilty of fraud. The debtor(s) is not subject to disqualification when the court determines fraud occurred; however, he or she may be subject to some or all of the fraud penalties in (b) of this Section.

(g) Intentional program violation (IPV) determination for TANF overpayments. For TANF, an IPV determination is made, when:

(1) the local, state, or federal court official agrees to pursue judicial prosecution and the court finds the debtor(s) guilty of fraud. When the court decision is a deferment, the prosecutor asks the accused person to sign Form 19MP002E, Disqualification Consent Agreement;

(2) Legal Services Appeals Unit staff holds an administrative disqualification hearing and determines intentional program violation; or

(3) the debtor(s) signs Form 08OP016E, Administrative Disqualification Hearing Waiver.

(h) TANF program penalty for overpayments classified as an IPV. Debtor(s) with TANF overpayments classified as an IPV may be subject to a 25 percent payment standard reduction penalty per Oklahoma Administrative Code 340:10-3-57(g) in addition to the requirement to repay the overpayment.

(1) AFS BIR staff applies the 25 percent payment standard reduction penalty period for:

(A) 12 months for the first violation;

(B) 24 months for the second violation; and

(C) permanently for the third violation.

(2) AFS BIR mails the Program Penalty/Disqualification Notice to the debtor(s). The notice informs the debtor(s) of the:

(A) IPV determination;

(B) 25 percent payment standard reduction penalty; and

(C) date the penalty period starts and ends.

(3) The 25 percent payment standard reduction penalty begins on the date shown on the notice. Once the payment standard reduction penalty begins, it runs continuously until the end of the period imposed regardless of whether the debtor(s) receives TANF benefits during the penalty period.

(i) When a court finds the debtor(s) guilty of fraud. When the court finds the debtor(s) guilty of SSP or TANF fraud, the court may order a fine, restitution, imprisonment, or any combination of the three per (b) of this Section. DHS abides by the court decision.  • 2

(1) Court-ordered restitution does not relieve the debtor(s) of any overpayment amount in excess of the judgment.

(2) When the court stipulates a repayment plan, DHS does not renegotiate the repayment plan with the debtor(s) unless the debtor(s) sentence expired and the court has no action pending against the debtor(s).  • 3

(3) When the debtor(s) defaults on court-ordered restitution, the court may accelerate the sentence, which may include the debtor(s) serving a prison term. Serving a prison term does not satisfy the debtor(s)’ responsibility to repay the monetary portion of the debt. At that point the debt may be subject to civil prosecution.

(4) The fact that a client is making restitution payments does not relieve the client of the obligation to sign Form 08OP002E, Affidavit of Acknowledgment of Indebtedness. Home property and personal property are exempt from this process. A lien may also be filed on declared real property when Form 08OP002E indicates property is owned.  • 4

Revised 9-17-18

1. (a) Office of Inspector General (OIG) findings include:

(1) a description of the investigation;

(2) documents acquired in the course of the investigation that prove the overpayment amount or that the client intentionally withheld information that would have reduced or closed the client's benefits; and

(3) Form 08OP016E, Administrative Disqualification Hearing Waiver, when signed by the debtor(s).

(b) When OIG staff discovers additional information after releasing the overpayment, he or she sends the information to Adult and Family Services (AFS) Benefit Integrity and Recovery (BIR). AFS BIR staff reviews the information to determine whether to adjust the overpayment.

2. (a) Only AFS BIR or OIG staff may discuss the overpayment with the debtor(s) until court action is completed or AFS BIR staff notifies the DHS county office or support center of any action to be taken. All other staff MUST NOT discuss the overpayment with the client while court action is pending. DHS county staff forwards further information or directs client inquiries to AFS BIR or OIG.

(b) The court may stipulate a repayment plan.

3. OIG staff may refer the case back to the district attorney's office when the debtor(s) fails to comply with the repayment plan and the debtor(s)' sentence has not expired.

4. Filing Form 08OP002E, Affidavit of Acknowledgment of Indebtedness, with the county clerk places a lien on the real property. Before filing Form 08OP002E, the worker checks the legal description of the property to ensure it conforms with the property deed. After filing, the worker sends the original and one copy of Form 08OP002E to AFS BIR. The remaining copies are filed in the case record.