If It Can Happen to Texas, It Can Happen To Your Business

 

Hello all! We're back from the holidays, being super duper sick and the most recent freeze. We hope that you missed us!

I heard about the Mississippi Welfare Scandal, and Brett Farvre's alleged role in it, and I thought that something similar would never happen in the great State of Texas. As you likely recall, funds intended for the most economically challenged people during crises in what is generally considered the poorest state in the country were misused and redirected to private projects/nonprofits. Very little of the money actually reached the intended recipients. Instead, huge sums went to politically connected friends' "non-profits," the development and promotion of a questionable concussion treatment drug, and a new volleyball stadium at the University of Southern Mississippi (USM). Brett Favre just happened to be involved in the concussion drug company and his daughter was coincidentally on the USM Women's Volleyball Team. The whole matter is gross and I cannot comprehend how Brett Favre escaped prosecution.

But that's Mississippi. Something like that could never happen in Texas, right?

Right. Well, kinda.

On January 17, 2025, The Texas Health and Human Services Commission notified 61,104 recipients of agency services and other affected individuals that their "protected health, personal identifying information or sensitive personal information may have been inappropriately accessed, used or disclosed." These affected persons had their personal account information accessed without a clear business reason. As you can guess, these accounts were allegedly accessed for more nefarious reasons, such as stealing money from individuals and families who rely on programs like Supplemental Nutrition Assistance Program (SNAP) and Temporary Assistance for Needy Families (TANF). TANF is the same program misused in the Mississippi Welfare Scandal. It sounds like TANF, which politicians love to demonize, is instead used as a slush fund for undeserving people. One article said it best:

For low-income Texans, public assistance is more than financial aid. It is a lifeline.

When funds are stolen or misappropriated, families face increased food insecurity. They also encounter housing instability, and difficulty accessing essential services.

Additionally, the psychological toll of financial uncertainty can weigh heavily on those already dealing with systemic poverty.

One Dallas mother, speaking anonymously to the Dallas Weekly, described the shock of discovering her SNAP benefits had been depleted.

I’d already planned meals for the week,” she said. “Without those funds, I had no way to feed my kids.”

Seven state employees have been terminated as a result of the investigation.

Disgusting. So far, no numbers have been given as to how much may have been stolen. However, this isn't the first that that something like this has happened in Texas. Last year, for example, two employees were fired after $270,000 was stolen from about 500 food stamp accounts. So the amount in question may be much, much higher.

The current Texas governor, thankfully, is not one of the persons where were terminated or who has been accused. He's a vile piece of s$%#, but for reasons unrelated to the theft of funds intended for Texas' most vulnerable. So there are differences in the Texas and Mississippi scandals.

And folks, this isn't the first time that something almost exactly like this has happened in Texas. How many more times will it take for Texas to get the message that what it is doing isn't working?

While Tragic, How Does This Situation Relate to My Business?

Easy. The Texas Tribute article puts it like this (emphasis added):

The seven firings, from four separate incidents in the past year, are remarkable because Texas’ entire apparatus for investigating fraud in public assistance programs in the gargantuan $93.4 billion Texas Health and Human Services Commission was built to focus on outside actors, such as providers or retailers and clients themselves. These cases, however, show threats from within the agency, impacting the public benefits of several low-income and disabled adults and children who live in Texas.

We could have told you that the greatest threat to your business is likely to come from your own employees. There are exceptions, of course. But dealing with outside threats is much more straightforward than guarding internal threats.

Takeaways

1. If something like this can happen to the great State of Texas (and I do think that Texas is great), it can happen to your business.

2. An overlooked enormous source of risk to companies is their own employees' bad acts.

3. Structural setups (policies, procedures, etc.) set up prior to bad acts are almost always more effective than a post-hoc investigation and cleanup.

4. Learn from someone else's poor choices so that you don't have to experience it yourself.

5. Hey Texas (and you!) - we're here to help if you're open to it.

    

   This post originally appeared on LinkedIn.