Audit: Maryland kept SNAP benefits flowing to $2M lottery winner, incarcerated people

BALTIMORE (WBFF) — A new state audit found Maryland improperly continued providing public assistance benefits to a lottery winner and incarcerated people, while uncovering a series of repeat management failures that auditors say have gone unaddressed for years.

The Office of Legislative Audits reviewed the Department of Human Services’ Family Investment Administration, FIA, which oversees nearly $1.9 billion in public assistance programs serving roughly one million Marylanders each year.

Among the audit’s most striking findings, auditors discovered a recipient who won a $2 million Maryland Lottery prize in July 2023 continued receiving Supplemental Nutrition Assistance Program, SNAP, benefits until February 2026.

Federal regulations require households to lose eligibility for SNAP shortly after receiving a substantial lottery prize.

“This is basic oversight. And right now, the state is failing at that,” said David Williams, president of the Taxpayers Protection Alliance.

The audit also found local departments failed to promptly act on other computer alerts involving lottery winners and deceased recipients, resulting in roughly $115,000 in benefits that should have been terminated sooner.

Maryland also lacks an effective process to identify incarcerated recipients who are no longer eligible for benefits. Between July 2022 and March 2025, auditors identified 1,858 incarcerated individuals who continued receiving SNAP and Temporary Cash Assistance, TCA, after spending more than 30 days behind bars. Federal rules prohibit those benefits while individuals remain incarcerated.

“This is a big problem when you have 1,800 people that should not be receiving food stamps that are receiving food stamps,” Williams said. “This isn’t one or two. This is almost 2,000. It shows you the extent of the problem.”

The audit also revisits Maryland’s ongoing struggles with SNAP payment accuracy.

Auditors said they received a fraud hotline complaint alleging the Department of Human Services intentionally manipulated the state’s SNAP payment error rate to delay future state costs under changes made in the federal One Big Beautiful Bill Act.

Investigators said they could not substantiate that allegation, but they concluded the agency “did not take sufficient action” to reduce Maryland’s error rate, resulting in $28 million in federal penalties assessed against the state.

Maryland’s SNAP payment error rate reached 35.6% in 2022 before falling to 19% in 2023 and 13.6% in 2024. While improving, the state’s rate remained above the national average, which hovered around 11% during that period.

“Management of the SNAP program at the state level is broken, and it’s costing taxpayers, and it is going to cost taxpayers even more with the new rules that were put in place,” Williams said

Beyond the headline findings, auditors emphasized that several deficiencies have appeared repeatedly in previous audits.

The report notes four findings were repeated from the agency’s last audit, while some issues stretch back even further. Auditors found failures to properly monitor computer eligibility alerts have been cited since at least 2019, despite the department promising to correct the problem. Another finding involving contract monitoring has appeared in five consecutive audits dating back to 2007.

“Unfortunately, this is typical for the state where there’s a previous audit, they ignore it, and then there’s a new audit talking about the same problems,” Williams said. “When there’s an audit, it’s not just good enough to have the audit. There has to be follow through.”

The Department of Human Services said it agrees with most of the recommendations and has already begun implementing corrective actions, including hiring nearly 200 new caseworkers and supervisors, expanding automated eligibility verification, strengthening fraud prevention measures and continuing efforts to lower the state’s SNAP payment error rate.

The agency’s response to the audit findings also indicated DHS has reduced its SNAP error rate by more than 60% since 2022 and believes many improvements occurred after the audit period ended.

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