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California pilot cuts estimated monthly EBT losses from $20M to $3M, officials say
Summary
Office of Data and Innovation witnesses described a Department of Social Services pilot that used a data pipeline and anomaly model to flag suspected Electronic Benefit Transfer (EBT) theft; ODI said monthly losses fell from about $20 million to about $3 million in the first month of the pilot and enforcement activity increased.
Jeffrey Marino, director of the California Office of Data and Innovation, told the Little Hoover Commission on May 28 that ODI partnered with the Department of Social Services to build a data pipeline and statistical model to flag anomalous EBT transactions. Marino said the model enabled earlier intervention — notifying cardholders to change PINs and directing enforcement staff to pursue cases — and that the pilot reduced estimated monthly losses from about $20 million to about $3 million in its first month.
Marino and Deputy Director Anne (Annie) Crew Renzo described the pilot as an example of ODI’s strategy: bring data to the teams that need it, prototype a focused tool, and then transfer the capability to the operating department. They emphasized that the data pipeline and model provided operable intelligence to department analysts who previously lacked access to transaction‑level feeds used in other fraud detection systems.
ODI officials said enforcement and prosecution decisions remain with local district attorneys and noted that prosecutions vary by case size and local priorities; they also acknowledged the figures were pilot results and said they would continue refining the approach and monitoring outcomes.
Why it matters: If verified and sustained, the pilot suggests a route to reduce benefit theft while improving service continuity for recipients — avoiding the delays and uncertainty that follow retroactive reimbursements. ODI framed the project as an example of lower‑cost, incremental work that can avoid multi‑year, multi‑million‑dollar procurements by focusing on a specific data and workflow problem.
What’s next: ODI said it will continue to refine the model with DSS and monitor enforcement and recovery metrics; the commission did not vote on policy but will review related topics in its ongoing IT delivery study.
Speakers quoted above are identified in the hearing record as Jeffrey Marino (Director, ODI) and Anne Crew Renzo (Deputy Director, ODI).
