Administrative Code

Virginia Administrative Code

Chapter 325. Fraud Reduction/Elimination Effort

22VAC40-325-10. Definitions.

For purposes of this chapter:

"Collections" means all overpayment monies collected, recovered or recouped by local departments of social services related to food stamps, TANF, and other federal benefit programs administered by the department.

"Department" means the state Department of Social Services.

"Direct costs" means the cost of salary, fringe benefits and supporting costs of operation. Cost for supervisory and clerical staff is excluded from reimbursement.

"Fraud Recovery Special Fund" means the special fund established under § 63.2-526 D of the Code of Virginia.

"Fraud Reduction/Elimination Effort (FREE)" means the program established in compliance with § 63.2-526 of the Code of Virginia to ensure that fraud prevention and investigation are aggressively pursued throughout the Commonwealth of Virginia.

"FREE prevention, detection and investigation units" means a person or persons whose job it is to work on all aspects of prevention, detection and investigation of fraud cases.

"General fund" means that portion of the budget of the Commonwealth of Virginia that is made up of general tax revenues, the major sources of which are sales tax, income tax, and profits from the Virginia Lottery.

"Investigation" means gathering evidence on questionable applications, on-going cases and closed cases to determine intent to defraud.

"Local department" means the local department of social services of any county or city in this Commonwealth.

"Performance expectations" means qualitative and quantitative standards or measures against which responsibilities and agency/departmental objectives are assessed.

"Private entities" means individuals or organizations other than federal, state or local personnel or agencies.

"Public assistance" means Temporary Assistance for Needy Families (TANF); auxiliary grants to the aged, blind and disabled; medical assistance; energy assistance; food stamps; employment services; child care and general relief.

"Reimbursement" means the process by which the Department of Social Services provides monetary credit to local departments of social services for their approved administrative costs.

"State retained portion of collections" means the amount of collections less any refunds due to the federal government, consistent with federal reimbursement regulations.

"Supporting costs of operation" means program costs other than salaries and fringe benefits. These supporting costs of operation include travel, telephone, utilities, supplies, allowance for space and training and conference fees for positions funded by the FREE program.

Statutory Authority

§§ 63.2-217 and 63.2-526 of the Code of Virginia.

Historical Notes

Derived from Virginia Register Volume 16, Issue 22, eff. August 16, 2000; amended, Virginia Register Volume 22, Issue 25, eff. October 1, 2006.

22VAC40-325-20. Fraud Reduction/Elimination Effort.

A. In compliance with § 63.2-526 of the Code of Virginia, the department shall establish a statewide fraud prevention, detection, and investigation program to be named the Fraud Reduction/Elimination Effort (FREE).

1. The department shall develop and implement policies and procedures for the FREE program.

2. The department shall provide a detailed local reimbursement procedure, on an annual basis, to assist in the formulation of the local department's FREE program operation plan. The department's procedure shall project the available funding and the number of local fraud investigators for each local department that the FREE program will support. The number of investigators shall be based on an evaluation of the available funding and appropriate criteria from one or more of the following: a local department's average TANF and Food Stamp caseload size, average number of monthly applications for food stamps and TANF, number of local department workers, geographic location, number of fraud investigations, program compliance, collections, and performance expectations.

3. The department shall develop, implement, and monitor local FREE units performance expectations.

B. Each local department shall aggressively pursue fraud prevention, detection, and investigations.

1. Each local department shall conduct fraud prevention, detection, and investigation activities consistent with the requirements of federal regulations, the Code of Virginia, this chapter, and the department's FREE program policy.

2. Each local department shall submit to the department for annual approval a program operation plan, formatted by the department, which shall include a description of the local department's prevention, detection, and investigative process; an agreement with the Commonwealth's attorney; identification of staff charged with oversight or supervisory responsibility of the FREE program; a performance expectation monitoring process; a signed commitment to adhere to specified responsibilities identified in the Statement of Assurance section of the program operation plan; and, if requested, a proposed annual budget to include the identification of the FREE program investigators, their salary, fringe benefit amounts, supporting operating costs, hours worked per week, and time dedicated to the FREE program.

3. Upon request, each local department shall provide the department with an accounting of FREE program expenditures.

C. Funding for the FREE program shall be comprised of balances in the Fraud Recovery Special Fund, general funds appropriated for this activity, and any federal funds available for this purpose.

1. In order to receive reimbursement of direct costs and supporting costs of operation, a local department must:

a. Comply with all pertinent law, regulation, and policy;

b. In accordance with the law, each local department shall establish and maintain a FREE prevention, detection, and investigation unit; and

c. Recover fraud-related and nonfraud-related overpayments of designated federal assistance programs. An allocation to localities shall be made in accordance with the following methodology: 40% based on each agency's Temporary Assistance for Needy Families, food stamp, energy assistance, and child care caseload; 20% based on the number of investigations completed; 20% based on the number of established claims; and 20% based on the actual collections from established claims. Each local department is reimbursed for fraud-related expenses through funds appropriated for local social services staff and operations.

2. Local departments may contract with other local departments to share a fraud prevention, detection, and investigation unit and may contract with private entities to perform fraud investigations. Any private entity performing fraud investigations shall comply with the requirements of § 30-138 of the Code of Virginia and the restrictions of § 63.2-526 of the Code of Virginia.

Statutory Authority

§§ 63.2-217 and 63.2-526 of the Code of Virginia.

Historical Notes

Derived from Virginia Register Volume 16, Issue 22, eff. August 16, 2000; amended, Virginia Register Volume 22, Issue 25, eff. October 1, 2006; Volume 33, Issue 24, eff. August 24, 2017.

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