25 Investigates: Welfare cash withdrawn at strip clubs, cruise ship, casinos

BOSTON — BOSTON -- A 25 Investigates review found millions in state welfare cash spent outside of Massachusetts – including taxpayer-funded withdrawals at strip clubs, resort hotels, casinos and even a cruise ship.

More than a year after Investigative Reporter Eric Rasmussen first exposed Massachusetts food stamps for sale on Facebook, he found the state is still struggling to track abuse of public money on EBT cards meant to help people get back on their feet.

The review of 2017 state data found:

  • EBT card holders racked up nearly $4 million in out-of-state welfare cash withdrawals, including $290,000 in Florida.
  • Taxpayers footed the bill for welfare dollars used in Hawaii, Myrtle Beach and even the Virgin Islands – where more than $4,000 in EBT cash was withdrawn for ATMs on the tropical island.
  • EBT cards were also used at ATMs inside strip clubs in Los Angeles and Boston, including $60 at The Glass Slipper – where the entrance fee is $10.
  • More than $6,000 in EBT cash was pulled from ATMs in the Las Vegas area, including several casinos and one card holder even took $100 from an ATM on a Carnival cruise ship.

“When you see abuses like this, it takes money away from senior citizens, veterans, children – people who really need these programs,” said state Rep. Shaunna O’Connell.

The Taunton Republican has unsuccessfully tried to pass laws that would restrict or ban the spending of welfare cash outside of Massachusetts.

“If you’re abusing the money, then I don’t think you deserve it,” said O’Connell.

State records also show EBT cash withdrawals at Ocean Gaming Casino in Hampton, NH and at Connecticut casino destination Mohegan Sun.

The Department of Transitional Assistance said the agency has blocked more than 2,000 ATMs where EBT cash is not allowed to be spent in the past five years, including that Mohegan Sun ATM.

Last year, 25 Investigates uncovered more than $3 million in suspicious welfare cash spending in just the first eight months of 2016 and found people selling Massachusetts food stamps on Facebook.

More than a year later, 25 Investigates has exposed new EBT fraud, including the case against Clei Henderson Sandoval-Arias, who is facing criminal charges in Suffolk County Superior Court for accusations that he stole another man’s identity to obtain thousands of dollars in public assistance, including food stamps.

Sandoval-Arias has pleaded not guilty.

25 Investigates also found people pulled more than $4,000 in welfare cash out of ATMs at medical marijuana dispensaries last year.

Using cash assistance for medical marijuana is legal, but 25 Investigates has confirmed several of those same locations are now seeking to sell recreational pot. Using EBT cash for recreational marijuana is against the law, but the state may not be able to block ATMs at pot shops in the future because those same cash machines may also be used by pot patients.

“The Department of Transitional Assistance is really going to have to keep an eye on what's going on,” said O’Connell.

DTA Commissioner Jeff McCue, who oversees the welfare cash program, declined an interview request, so 25 Investigates asked Gov. Charlie Baker whether the state is doing enough to reign in lavish welfare spending.

Baker said, “Every time we find out about ATMs or other cash withdrawal entities – as they come through the process – that shouldn't be deemed accessible, we shut them off and we’ll continue to do that.”