1. States are bracing for federal SNAP adjustments

As federal budget changes roll out this fall, multiple states — including Michigan, Ohio, Georgia, Pennsylvania, and Arizona — are warning that the transition could expose long‑standing weaknesses in the SNAP system. Governors and state agencies are flagging:

• outdated eligibility verification systems
• inconsistent fraud‑detection tools
• large administrative backlogs
• uneven enforcement between states

These weaknesses are exactly where waste and fraud tend to hide.

2. Fraud remains a small percentage — but a huge dollar amount

Nationally, SNAP fraud is officially estimated at around 1–2% of total benefits. That sounds tiny… until you remember SNAP is a $120+ billion program.

That means even “small” fraud rates translate to:

• $1.2–$2.4 billion in fraudulent or improper payments
• plus billions more in unverified or suspected misuse

States are warning that the upcoming federal changes could increase improper payments if verification systems aren’t upgraded.

3. The biggest sources of waste & fraud right now

Here are the categories states are most worried about:

A. Stolen EBT cards (skimming & cloning)

Criminal groups skim card numbers at ATMs and stores, then drain benefits. Losses have surged in the last two years.

B. Trafficking (selling benefits for cash)

This is the classic “50 cents on the dollar” exchange. It’s still happening, especially in:

• small convenience stores
• gas stations
• unlicensed retailers

C. Improper eligibility approvals

States with outdated systems sometimes approve:

• duplicate households
• unverifiable income
• unreported employment
• people who moved out of state

D. Retailer fraud

Some stores inflate transactions or ring up non‑food items as SNAP‑eligible.

4. Why states are sounding the alarm now

The federal changes rolling out this fall include:

• shifts in administrative funding
• adjustments to eligibility review timelines
• new reporting requirements
• changes to how states verify income and household size

States say these changes could strain already‑weak verification systems, making it easier for:

• fraudulent applications to slip through
• stolen EBT benefits to go undetected
• trafficking operations to expand
• improper payments to increase

In short: the system is being asked to do more with tools that already struggle.

5. Michigan’s angle 

Michigan’s Department of Health and Human Services has specifically warned that:

• EBT skimming is rising
• verification delays are increasing
• staffing shortages make fraud detection harder
• rural counties are seeing more trafficking cases

Michigan isn’t alone — but it’s one of the states openly acknowledging the problem.

6. What’s next

Congress is expected to debate:

• tightening retailer certification
• expanding fraud‑detection funding
• requiring stronger identity verification
• modernizing EBT systems (chip cards, PIN changes, etc.)

But nothing is guaranteed yet.

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