International edition
June 22, 2021

Representing 1% of the total us$ 10.8 billion welfare fund spent over the three-year period

Nearly us$ 70 million in California welfare spent on luxury

(US).- California Governor Arnold Schwarzenegger ordered the California Department of Social Services to place new restrictions on the use of welfare cash cards. Aaron McLear, spokesman for the Governor said this week, “”We have instructed our vendors to prohibit these cards from being accepted at ATMs located in casinos and card rooms.”


he decision came in response to a report published last week by the Los Angeles Times showing that nearly us$ 70 million in California welfare funds had been withdrawn from ATMs in casinos, cruise ships and luxury vacation spots outside of California, over the past three years.

California Social Services Director John Wagner said the new spending guidelines restrict spending in strictly recreational locations, but do not block out-of-state welfare fund withdrawals. “If someone has an elderly parent in Hawaii, and the parent brings them over, and they’re caring for their kids, that’s a legitimate use of funds,” he explained.

Monday’s report revealed that between January 2007 and May 2010, California welfare recipients had used their electronic benefits transfer cards (EBTs) to withdraw more than us$ 69 million from ATMs in popular holiday spots, cruise ships and casinos across 49 states, as well as in the Virgin Islands and Guam. In Las Vegas alone, California welfare recipients accessed us$ 11.8 million (more than us$ 1 million of which was spent or withdrawn at or around the Las Vegas strip).

The us$ 69 million in California welfare funds accessed and spent in luxury vacation spots, casinos and cruises represent about 1% of the total us$ 10.8 billion welfare fund spent over the three-year period.

Republicans and Democrats have responded to the reported welfare abuse in much the same way. Seth Unger, spokesman for the Assembly Republican Caucus said, “In a time when we have a us$ 19-billion deficit, and we’re taking a serious look at the future of many safety-net programs, it’s appalling to think that welfare beneficiaries can use their cards in a casino.”

On Wednesday, Shannon Murphy, spokeswoman for Democrat Assembly Speaker John A. Perez said, “In these tough times … we have to make sure food stamps and other services are being used the way the people of California intended them to be. Other states have closed this loophole, and the Assembly will work with the Schwarzenegger administration to make that happen.”

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