$43,000 of Kansas Welfare Money Withdrawn From ATMs at Strip Clubs, Casinos

April 10, 2013 - 9:12 AM

Tens of thousands of dollars intended to buy gas, groceries and other necessities for Kansas welfare recipients may have been spent on strippers, liquor, and gambling during a three-month period studied by a watchdog group.

The investigation, conducted by KansasWatchdog.org, flagged $43,000 dollars in questionable spending by Kansans receiving Temporary Assistance for Needy Families.

"From August to October 2012, Sunflower State welfare recipients withdrew more than $43,000 from ATMs at places like Golden Eagle Casino in Horton, Vegas Video Adult Superstore in Wichita and G Spot, Junction City strip club, just to name a few," writes Travis Perry of Kansas Watchdog.

As part of the TANF program, federal taxpayer dollars are moved to the states in block grants, with the goal of helping to move find jobs – “and turn welfare into a program of temporary assistance,” says the U.S. Department of Health and Human Services. States give needy people debit cards (Electronic Benefit Transfer or EBT cards), which can be used to make purchases or withdraw cash from ATMs.

In Kansas, a family of four can get up to $497 a month.

KansasWatchdog found that the largest amount of questionable ATM withdrawals came from smoke shops and cigarette retailers, totaling $19,302.42 during the three-month period. Cash advance and payday loan locations came in second ($8,578.10), followed by liquor store withdrawals ($6,500.98), casinos ($4,532.25), bars and restaurants (1,298.45) and miscellaneous locations ($3,271.44).

Here are some examples of the ATM locations from which welfare cash was withdrawn: This is not a complete list:

  • Speedy Cash – $3,621.50
  • Ace Cash Express – $4,956.60
  • 7th Street Casino – $2,455
  • Buffalo Run Casino – $218
  • Choctaw Casino – $746
  • Golden Eagle Casino – $704.75
  • The Legends shopping center – $1,056
  • Smoke Eazy – $922.50
  • Bullfrogs Live – $102.50
  • Dave and Busters – $387.50

The Kansas Department for Children and Families (KDCF) website says recipients would be declined if they attempted to use their EBT cards to buy tobacco, alcohol, and lottery tickets as a direct purchase. However, a majority of these locations have ATMs.

Angela de Rocha, the communications director for KDCF, said there's no way to stop questionable withdrawals.

“You can take your Vision card into a strip joint or Disney Land or Graceland or wherever and use that to get cash. There’s nothing we can do about that. We can’t control that,” de Rocha previously told the group.

The data, which Kansas Watchdog eventually received through an open-records request, shows that between August and October 2012, $1.5 million in transactions were made by Kansas TANF recipients. Questionable withdrawals amounted to less than 3 percent of the total.