This is very old and very ignored by Pols & Media.
This goes back as far as when food stamps were actually stamps.
The scam went one of two way: A third party would buy the stamps at 50 cents on the dollar and even less so the recipient would have cash to get whatever vice or non-food item desired. The other one was that the unscrupulous grocer himself would allow the individual to buy non-approved items and pay with food stamps but at a “discount” on the coupons, also around 50% of the printed value and then claim they were used to buy food and approved essentials.
How bad is this fraud concept spread? Some years back right when gift cards became fully popular, people with good intentions recommended to give the “homeless” panhandling in corners or threatening to clean your windshield gift cards for McDs or other fast food eateries rather than cash because they assumed drug dealers only wanted cash for their drugs. Their exalted minds assumed the homeless would have to use the card and actually eat rather than shoot up or smoke or snort whatever crap they were into. Apparently nobody saw coming that junkies would trade the gift cards for cash at a discount to go get drugs. Eventually the Do-Gooders found out the reality of life and stopped recommending the gift card thing after much laughter by dopers, users and people living in the real world.
Ladies and gents, we are talking about miscreants that prostitute themselves and their kids to maintain a lifestyle at taxpayers’ expense. They do not think twice about defrauding you or me as long as they can get the latest I-Phone and the acrylics at the end of their fingers.
And there is 40 million of them sucking at your wallet right now.
Basically, then, income redistribution with the usual waste and inefficiency of any large program wherein people aren't spending their own money.
I'm liking, more and more, distribution of actual food - staples, basics, not-bad-for-you, not-luxury but reasonably nutritious. Might not be a fun snack, might be bland, but keeps body and soul together for the time being. Yes it could still be sold off, but unlike the transactions above, at some point someone's going to take delivery of rice and black beans, not caviar and brie.
The only time I have heard of the "gift card" technique working was when local eateries and convenience stores printed their own. They had zero dollar value outside of that shop(s).
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Because it was local, the drug dealers and miscreants were known, so they could not use them for food, and they had no value on eBay or Craigslist. A $1 coupon for 3rd St. convenience or Jack's coffee shop was useable only there.
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Curiously, the homeless problem almost disappeared overnight when that system went into place. Turns out, a lot of the panhandlers were only interested in the money, not actually food.