Maryland wrongly paid SNAP benefits to $2M lottery winner, people who are incarcerated, audit finds
A new audit shows Maryland's Department of Human Services administered Supplemental Nutrition Assistance Program (SNAP) benefits to ineligible residents, including lottery winners and people who are incarcerated, resulting in a $28 million penalty for the state.
SNAP benefits help low-income households buy food, but recipients are required to meet certain income and residency criteria.
The July 2026 audit from the General Assembly's Office of Legislative Audits Department found the Family Investment Administration (FIA) failed to "conduct timely and appropriate follow-up of questionable recipient eligibility identified by its computer matches, resulting in improper or questionable benefit payments."
What the report found
In one instance, the audit found someone with a $2 million lottery winning had been flagged by the system in July 2023, but was still receiving benefits as recently as February 2026 -- for a total of $9,000 in benefits since being flagged.
Under federal law, a household immediately becomes ineligible for these benefits after winning a "substantial" lottery prize.
The audit also found 1,858 instances of incarcerated people still receiving SNAP or Temporary Cash Assistance (TCA) benefits between June 2021 and February 2025. The audit acknowledged the FIA was working to identify these individuals, but data from the Department of Public Safety and Correctional Services (DPSCS) was incomplete.
Federal law says people who are incarcerated for more than 30 days become ineligible for such benefits.
"Although FIA performed weekly matches to identify incarcerated individuals using Department of Public Safety and Correctional Services (DPSCS) incarceration records, our review disclosed that the data used in these matches was incomplete and FIA did not always ensure proper action was taken for matches identified," the audit said.
DHS responds
The Department of Human Services responded to the report, saying in part, "The Department is focused on making vital benefits easier to access and more secure. We are building a public assistance system that is faster for families, more resilient against fraud, and more accountable to taxpayers."
"Addressing audit findings is a top priority," the statement continued. "We are committed to ensuring findings are fully resolved and are used to strengthen the integrity and performance of the programs we administer."
When it comes to addressing lottery winners, the department said it is working to automate its systems and close cases once winners are flagged.
The department also said it is working with DPSCS to identify any discrepancies in the eligibility system.
Errors cost Maryland $28M in penalties
New federal regulations penalize states with SNAP error rates above the national average for two consecutive years.
Federal calculations found Maryland's SNAP error rate was 35.6% in 2022, 19% in 2023 and 13.6% in 2024, while the national average for that period ranged from 10.9% to 11.7%.
In response, Maryland was hit with a $16.6 million penalty for 2022 and 2023, followed by an $11.4 million penalty for 2024 -- for a total of $28 million.
While the state's error rate improved over those years, the audit noted it had historically been close to the national average.
