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Wednesday, August 15, 2018
$2M Lottery Winner Uses Food Stamps

I’m not providing commentary on this one, just reporting the news.  A Michigan man has been collecting and using food stamps for 11 months after winning  $2M from his state’s lottery and there is apparently nothing that the state can do about it – yet.  The man, Leroy Flick who drives a brand spanking new Audi, was seen using the food stamp card called the Bridge Card which is intended for use by low income families.

What many residents in Michigan did not know is that Flick himself had already reported his lottery winnings to the state welfare department and was told that he is eligible to continue using the card.  Why?  Well, there is a gapping loophole in Michigan’s welfare program.  Lottery winning are not counted as income, they are counted as liquid assets.   It seems that liquid assets are not used in the income calculation on which welfare eligibility is based.   Because of this, Mr. Flick is able to continue using his Bridge Card.

Welfare officials and  the public are understandably outraged.  Department of Human Services are seeking to close this gaping loophole that has been outed by Mr. Flick’s case, however, the rules on eligibility are determined by the Federal government. While Mr. Flick’s case highlighted this problem, I wonder just how many people are on welfare rolls that have millions stashed in the bank.

What are your thoughts about this?

This post was included in the Festival of Frugality #281 Graduation Statistics Edition hosted by My Personal Finance Journey.

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Celeste May 20, 2011 at 2:04 pm

This is what I consider abuse—and could possibly take $$ away from people who truly need it making these actions even worse by the people who don’t need the help. It also shows that there is no stigma in getting government hand outs of this nature, which keeps people from working to get themselves off the public dole. Not to mention that these types of stories get certain people all riled up and wanting to get rid of ALL subsidies to the poor which would be also be terrible. There has to be a way to stop the abuse and encourage people to be self reliant.

CF May 20, 2011 at 3:28 pm

Terrible. :/

Money Cone May 20, 2011 at 4:11 pm

What do I think about this? He’s one smart man!

Paula @ AffordAnything.org May 20, 2011 at 4:53 pm

Unfortuantely, some of the biggest welfare beneficiaries are simply the people who know how to play the loopholes to their advantage. It’s not that different from paying taxes — if you know how to play the loopholes right, you can really avoid paying a lot of taxes.

I try not to be political, but I will mention that America has a huge national deficit, and curbing our spending is essential.

retirebyforty May 20, 2011 at 11:55 pm

I’m speechless….
Maybe he is going to stick to the frugal lifestyle and donate that $2M to charity???

krantcents May 21, 2011 at 11:38 am

The state of Michigan has a problem! Liquid assets is an asset that can be sold or exchanged easily without loss of value into another asset or cash. How can you be poor if you have liquid assets of hundreds of thousands of dollars? I blame the state for this situation!

    Stephanie May 23, 2011 at 11:28 am

    Exactly what I was going to say. I mean, yeah, he won $2M and could just say “ya know what? I’ll stop using it”, but he’s still eligible. This is the state’s issue.

    No Debt MBA May 23, 2011 at 3:19 pm

    I agree. Ignoring liquid assets is pretty dumbfounding.

optionsdude May 21, 2011 at 10:03 pm

Clearly there ought to be some thought and foresight that goes into the laws made by the governments. The fact that there are loopholes merely demonstrates that unintended consequences exist and that not all situations can be accounted for when making these laws and rules. Obviously, this needs to be fixed. Any lottery winner ought to repay all debts and prior state aid before receiving winnings.

Bret @ Hope to Prosper May 22, 2011 at 3:50 am

I think there are really two lessons from this story.

First, is the sense of entitlement that has become so ingrained in America that a millionaire has no shame in using food stamps. I read this article and this man considers himself entitled to the benefits created for the poor. More important, there are millions of others who are less well off that don’t need these benefits, but they are taking advantage of them anyway.

Second, is the institutionalization of waste in our country. Government workers will always enourage people to take advantage of the benefits from their departments, whether they need them or not. This ensures their job and funding for their department. There is zero incentive to save money or cut back in any way. In fact, it could cost them their jobs.

    Sandy May 22, 2011 at 11:55 am

    Yes, he was incredulous that people thought that he shouldn’t be collecting food stamps! He was actually angry about it. I don’t get it. You are a millionaire in your 50’s! If you invest conservatively your money should long outlive you.

B Kelly May 22, 2011 at 10:50 am

definitely a loop hole in the law here.. they should total assets as a gauge as to whether you are eligible for food stamps instead of a category classification which is not encompassing and misleading.. esp during this time when there are real people out there who need help..

101 Centavos May 22, 2011 at 11:49 am

What’s the number of people on food stamps up to now, something over 40 million?
And JP Morgan has the largest contract to process the claims … their CEO admitted on the record that this area is “very very important” to their business.

    Sandy May 22, 2011 at 11:53 am

    So they make money with more people on welfare. Something about that seems so wrong to me.

Super Frugalette May 22, 2011 at 11:17 pm

It’s wrong.

Amanda L Grossman May 23, 2011 at 5:55 pm

I think it is morally wrong for him to have known about the loophole, and continued using the food stamps anyway. He obviously can take care of himself, and Michigan is majorly hurting as a state. There are people I am sure he grew up with and live around who could use the money he is taking.

Funny about Money May 25, 2011 at 1:25 am

Wow! Now THAT is cheap!

Holly May 27, 2011 at 8:48 am

I believe that there are people who are divorced/separated (or even never married but had children together) who find ways to ‘game the system’. The child/ren will live with the parent who makes a lot less $ than the other. Then the child (and possibly the mother) are eligible for welfare funds/medicaid/food stamps, even though the ex-spouse is providing for them (without the gov’t. knowing).

Where I work, there are patients who are on medicaid but are talking to their friends on their iphones about the cruise they booked this summer.

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