NM Political Report: Accusations of widespread fraud at HSD grow while officials plead the fifth0

Republished with permission from the NM Political Report. Read the original article here.

By Joey Peters | May 13, 2016

LAS CRUCES — In a scene of high drama reminiscent of the TV drama “Law and Order,” three prominent state Human Services Department officials invoked their fifth amendment rights nearly 100 times in federal court Friday afternoon.

Legal Director Gail Evans and co-counsel Dan Yohalem outside the federal courthouse in Las Cruces.
Legal Director Gail Evans and co-counsel Dan Yohalem outside the federal courthouse in Las Cruces.

Their refusal to answer questions came directly after sworn testimony from six HSD employees who alleged a widespread practice of fraudulently altering federal food benefits applications.

The practice, according to eight former and current HSD employees who testified in federal court last month and today, amounts to adding false assets to the applications of people who would otherwise qualify for emergency aid from their Supplemental Nutrition Assistance Program, otherwise known as food stamps.

“I still don’t understand why I had to falsify assets,” Shar Lynne Louis, a case processor at HSD’s Income Support Division (ISD) office in Gallup who retired last July, said in court.

Louis testified that the state had been practicing the pattern of fraud since at least 2003, when she first came to the department.

Federal law requires states to give food benefits for applicants who qualify for emergency, or expedited, benefits within seven days of applying. But HSD, according to many testimonies, has been long burdened with emergency applications that aren’t processed within the required seven days.

Instead of processing emergency applications late, department officials instructed employees to add fake assets so the application no longer meets expedited SNAP requirements.

“They make up the resources, whatever the case is, whatever the situation is,” Veronica Arciero, a case processor in the Silver City, said of the department’s handling of late emergency applications.

This practice of adding of what one attorney called “phantom assets” helps HSD to clear its backlog of overdue emergency applications, according to testimonies.

Arciero said the consequence of the practice amounted to putting applicants’ cases “on hold so they don’t they don’t receive the benefits they should have.”

“It’s lying,” she said. “It’s not something the customer is reporting.”

Mary Alice Duran, another employee who processed cases for 25 years in Santa Fe, Taos and Las Vegas and retired in 2013, also said the practice meant people qualified for emergency food aid didn’t receive their benefits later.

“It creates a hardship for the family,” Duran said.

One current employee who works in Silver City, Alexandra Hancock, even testified that she was reprimanded for processing a late application the correct way instead of adding fake assets to delay the benefits.

Specifically, Hancock testified that she fixed a late case where the applicant had reported $700 in income for the month and another employee wrongly wrote that income as $1,500. Because the applicant’s rent and utility expenses exceeded his monthly income, he qualified for expedited SNAP aid, according to Hancock.

But after she fixed and processed the case, Hancock told the court that Income Support Division Director Marilyn Martinez and former Deputy Director Laura Galindo instead told her she would be referred to HSD’s human resources department if it happened again.

“You had to answer for proving the benefits?” Sovereign Hager, an attorney for the Center on Law and Poverty, asked Hancock in court.

“It was said we had to do everything in our power to stop late expedites,” Hancock responded. “There was nothing I could have done other than entering fraudulent resources.”

She added: “We’re leaving kids and parents and the elderly without the food they need on their table.”

The Center on Law and Poverty is asking the federal court to appoint an independent monitor to oversee the state’s SNAP and Medicaid processing.

Martinez, Galindo and Taos County ISD Director Emily Floyd all invoked their Fifth Amendment rights when brought to the stand, refusing to answer a total of 97 questions Hager and attorney Daniel Yohalem* asked between the three of them.

The U.S. Constitution allows people to invoke Fifth Amendment rights to avoid implicating themselves in illegal activity. Invoking the Fifth Amendment itself cannot be used to implicate the person in illegal activity.

Questions that Martinez, Galindo and Floyd refused to answer ranged from whether they played ordered the fraud, retaliated against workers and lied to federal court in previous court hearings and motions.

The officials did not respond to any questions, including those to provide background on the working of HSD.

Last month, ISD Deputy Director Shanita Harrison in her own testimony accused three employees who testified with fraud allegations of instead making mistakes on their case processing themselves.

Jeanette Roybal, who works for ISD in Las Cruces, told the court that she had experienced workplace retaliation since first testifying about SNAP fraud in federal court last month.

“They’ve been monitoring me more often,” Roybal said of her supervisors. “They’re constantly stopping by and they’ll stand and stare at me.”

Roybal also said her workplace emails concerning a case with false assets had been deleted since she gave her first testimony last month. She also testified that her managers have access to her workplace emails.

Paul Kennedy, an attorney who represented HSD in court Friday, asked Roybal whether her managers would have had to personally go through her workplace computer to access her and delete her emails.

“As far as what I’ve been told, no,” Roybal responded.

An HSD spokesman who attended the court hearing would not answer questions from NM Political Report about the allegations or why their officials invoked their Fifth Amendment rights immediately following the proceedings. Instead, Kyler Nerison instructed NM Political Report to send him questions via email, to which he did not respond.

Kennedy told NM Political Report he wasn’t “authorized” to comment on the proceedings.

During the hearing, attorney Christopher Collins, who also represents HSD, referred to department’s internal investigation of the allegations, launched last month shortly after the allegations became public. HSD Secretary Brent Earnest also sent employees a directive telling employees to process expedited SNAP cases per federal law.

“People [today] testified that they received that received that directive and are following that directive,” Collins said.

He also said HSD issued a request for proposal to bring an outside consultant to oversee the department’s training of ISD employees and compliance with federal law. Such a process, Collins said, “could be implemented within 12 months.” The request for proposal process alone, Collins said, would take six to nine months.

Collins argued for judge to give the department 90 days before allowing both parties to make their closing arguments. Federal Magistrate Judge Carmen Garza instead scheduled the next court hearing for early July.

“Whatever is going on here—and we don’t know and are certainly concerned by what we hear—we don’t have all the facts,” Collins said in court.

The SNAP processing fraud allegations are part of ongoing legal motions by the Center on Law and Poverty to enforce a 25-year-old consent decree that the organization says HSD is not following. The consent decree came in 1991 as the settlement of a class action lawsuit that accused HSD of not properly processing SNAP and Medicaid benefits.

After the hearing, Hager told NM Political Report that she found the Fifth Amendment pleadings “very troubling” that the HSD officials would “invoke a right to not incriminate themselves” by not answering questions about the department’s “basic operations.”

Yohalem told told NM Political Report that he has “never seen this happen” in his 42 years of practicing civil rights law.

“If the department didn’t know what was going on,” Yohalem said of the fraud allegation testimonies, “why would they take the fifth?”

State Auditor Tim Keller’s office has also launched a separate investigation into the fraud allegations.

*Daniel Yohalem is representing the Santa Fe Reporter newspaper in a public records lawsuit against Gov. Susana Martinez. That lawsuit originated in 2013, while Joey Peters worked as a reporter for the newspaper.

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