Minnesota Millionaire Applies for SNAP to Prove ‘Fraud by Design’ Loophole
Rob Undersander is a retired engineer with significant savings, property, and no shortage of financial security. He is also a former food stamp recipient. In 2016, Undersander applied for SNAP benefits in Stearns County, Minnesota, to test a gap in the eligibility rules he had discovered while volunteering to help seniors navigate government benefits. He was approved within weeks. What he found set off nearly a decade of advocacy that is now headed to the Minnesota statehouse.
The loophole Undersander identified is straightforward. In Minnesota, SNAP eligibility is calculated using income alone, with no consideration of assets. Because his retirement income fell below the threshold, Undersander qualified despite holding substantial wealth in savings and property. Over the following year, he collected thousands of dollars in benefits and donated the money to charity, deliberately creating a paper trail that would be difficult to ignore. “I have purchased lobster and filet mignon on my EBT card,” he told Fox News Digital. “Isn’t that crazy?”
Undersander will testify before the Minnesota House Public Safety Committee on Tuesday at a hearing on a SNAP reform bill introduced by Republican state Representative Pam Altendorf. The bill proposes stricter income and asset verification before applicants can enroll in the program. For Undersander, the hearing represents the culmination of a decade of warnings to legislators who, in his assessment, have repeatedly failed to act. The question facing Minnesota now is whether the political will finally exists to close what he calls “fraud by design.”
How Minnesota’s SNAP Spending Exploded and the Fraud That Followed
The numbers behind Minnesota’s food assistance program tell a story of rapid expansion and inadequate oversight. According to a November press release from Representative Altendorf’s office, Minnesota distributed nearly $725 million in SNAP benefits in 2020. One year later, that figure jumped to nearly $2 billion, a 174% increase in a single year. The surge was driven partly by federal COVID-19 relief measures that broadened access to food assistance, but the scale of the increase also created conditions that made fraud significantly easier to commit and harder to detect.
The consequences have been severe. Minnesota is currently managing what officials describe as an exploding fraud scandal that could extend into the tens of billions of dollars across its broader welfare system. In one recent case, a Minnesota woman was sentenced to approximately one year in federal prison for operating a $325,000 SNAP fraud scheme with family members. Prosecutors described a system of fake identities and fraudulent documents used to obtain multiple EBT cards, with funds then withdrawn and sold for profit. She was ordered to repay the stolen amount.
Nationally, SNAP spending has followed a similar trajectory of expansion. Federal spending on the program reached $128 billion in 2021 and $127 billion in 2022, driven by pandemic-era relief measures, according to Fox Business reporting. Last year, the program cost $99.8 billion, with participants receiving an average of $187 in monthly benefits. Undersander frames the scale of the program against the broader economic backdrop: “When we have nearly one in seven Americans receiving food support in the wealthiest nation on earth, with historically low unemployment, something is wrong.”
The Asset Test Gap That Lets Lottery Winners and Millionaires Qualify
At the center of the reform debate is a policy mechanism called broad-based categorical eligibility, which allows states to bypass standard federal asset limits when determining SNAP eligibility. Minnesota is among the states that have adopted this approach, meaning that an applicant’s savings, property, and overall wealth are effectively invisible to the eligibility calculation. Only income is measured. Matt Schmid, Health and Harvest Campaign Director at the America First Policy Institute, who is also testifying Tuesday, described the result plainly: “Even millionaires and lottery winners can qualify for taxpayer-funded benefits.”
Altendorf’s reform bill targets this gap directly by requiring asset verification as part of the enrollment process. Proponents argue that restoring an asset test is not about reducing access for genuinely struggling families but about ensuring the program reaches the people it was designed to serve. “SNAP is meant to help needy Minnesotans put food on the table, not to subsidize people who already have significant financial resources,” Schmid told Fox News Digital. Supporters of the bill also note that high error rates in Minnesota’s program create financial risk under federal rules tied to the One Big Beautiful Bill Act, which requires states to manage SNAP more effectively or absorb more of the cost burden themselves.
Undersander has been raising these concerns since 2016, including testimony before Congress, and says the response from elected officials has been negligible. “One might call the current eligibility rules fraud by design,” he said. “And given the current climate of fraud and abuse of taxpayer-funded benefits in Minnesota, I’m hoping that there will be a new bipartisan effort to reduce and eliminate both.” His position is careful to separate the program’s purpose from its administration: he describes himself as a strong supporter of food assistance for genuinely needy individuals, while arguing that the current rules undermine the program’s integrity and long-term viability.
A Reform Bill, a Fraud Scandal, and a Governor Under Pressure
Tuesday’s hearing arrives against a politically charged backdrop. Governor Tim Walz, who announced earlier this year that he will not seek reelection, has faced sustained criticism over the scale of fraud that has emerged from Minnesota’s welfare programs. Hundreds of millions of dollars in fraudulent food aid payments have been uncovered in recent years, and the full scope of the broader scandal remains under investigation. Fox News Digital reached out to Walz’s office for comment on the pending legislation and the administration’s efforts to combat SNAP fraud but did not receive a response.
The America First Policy Institute argues that the path forward does not require dismantling the program, but rather rebuilding its guardrails. Experts affiliated with the organization contend that closing key loopholes, including broad-based categorical eligibility, would strengthen income and asset verification, reduce payment errors, and improve the program’s overall integrity without cutting off access for households that genuinely need help. “Reintroducing basic guardrails like an asset test is a common-sense step to restore integrity,” Schmid said, “and protect the long-term viability of the program.”
What happens in the Minnesota statehouse Tuesday may signal something larger about the direction of SNAP reform nationally. The program serves tens of millions of Americans and costs nearly $100 billion per year. Whether states choose to tighten eligibility rules independently, or wait for federal mandates to compel them, the conversation Undersander started with a single application in Stearns County nearly a decade ago is no longer a fringe argument. The deeper question — who a safety net is designed to catch, and how a system ensures it catches the right people — remains one that no reform bill alone can fully answer.