Colorado regulators are apparently ignoring a two-decade old state law prohibiting welfare recipients from receiving cash from ATMs in liquor stores and casinos, with nearly a half-million dollars being withdrawn from such locations in just the past two years.
The Colorado Department of Health and Human Services is aware of the violations, but doing nothing to stop them, according to an investigative report by the website Colorado Watchdog.
The site compared databases for ATM locations and welfare recipients who used their cards, loaded with taxpayer cash, to withdraw money.
It found that, since 2012, welfare recipients withdrew $340,000 from ATMs located in liquor stores and another $149,000 at Colorado casinos.
Welfare recipients also withdrew at least $12,000 from ATMs located in marijuana dispensaries, according to the site’s analysis.
The withdrawals are in violation of state law as well as a federal law prohibiting withdrawals at the same locations.
In a letter to Colorado Watchdog sent along with its databases, spokeswoman Liz McDonough acknowledged that some welfare recipients are breaking the law, but said it was only a small number.
“Please note that fewer than one per cent of the transactions detailed occurred in prohibited locations for an amount less than one percent of the benefit dollars accessed,” she wrote.
Another agency representative told the website that no one has been punished or had their benefits revoked or suspended for breaking the law, which has been on the books since 1996.
“No one lost benefits at this time,” Levetta Love told the site. “The number of recipients accessing benefits in these locations is statistically insignificant.”
The newer federal law requires enforcement of the prohibitions on cash withdrawals or states could face a 5 percent cut in federal welfare benefits. The 2012 federal law also restricts withdrawals from ATMs inside legal marijuana stores, but that also hasn’t prevented welfare recipients from using them.
“At least prevent the use of these types of cards to buy marijuana,” said Republican state Rep. Tim Dore,in comments to Colorado Watchdog. “We’re going to allow people to get money to abuse a drug that isn’t even legal federally?”
Colorado has so far failed to pass a law adding marijuana stores to the list of prohibited locations and Dore said he would likely bring another bill during the 2015 legislative session.
The laws preventing ATM withdrawals in adult businesses do not require the business owners to monitor customers taking out cash.