Minnesota millionaire who qualified for food stamps warns of 'fraud by design' loophole ahead of hearing

Ahead of a Tuesday hearing where Minnesota lawmakers will discuss food stamp fraud, Fox News Digital spoke to a millionaire who says he was able to qualify for food stamps through a loophole — one that he hopes will soon be closed as the state grapples with a massive fraud scandal.

Rob Undersander, a retired engineer who volunteers to help seniors navigate the government benefits system, said he learned during training that eligibility for the Supplemental Nutrition Assistance Program (SNAP) in Minnesota was based on income only, not assets. Because his retirement income was low, he realized he could qualify even though he had significant savings and property.

To test the system, Undersander applied for benefits in Stearns County in 2016 and was approved within weeks. He later said he collected thousands of dollars in SNAP benefits over more than a year, which he donated to charity, in an effort to draw attention to the issue.

"I strongly support SNAP benefits for truly needy individuals, but when we have nearly one in seven Americans receiving food support in the wealthiest nation on earth, with historically low unemployment rate, something is wrong," Undersander told Fox News Digital. "One might call the current eligibility rules fraud by design. 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."

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As Minnesota continues to deal with an exploding fraud scandal that could reach into the tens of billions of dollars, Undersander will testify in front of the Minnesota House Public Safety Committee on Thursday in a hearing on a SNAP reform bill introduced by GOP state Rep. Pam Altendorf.

The bill would tighten eligibility rules for food stamp benefits by requiring stricter income and asset verification before recipients can enroll in SNAP.

Over the 10 years since he first exposed the flaw in the SNAP system, Undersander has become a vocal advocate of making changes, even testifying before Congress, but says nothing has been done by the elected officials. 

"I have purchased lobster and filet mignon on my EBT card," Undersander said. "Isn't that crazy?"

During former President Joe Biden's administration, federal spending on SNAP climbed to record highs at $128 billion in 2021 and $127 billion in 2022, largely driven by COVID-19 relief measures that expanded access to food assistance," Fox Business reported in November.

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Last year, SNAP cost $99.8 billion, with participants receiving an average of $187 in monthly benefits, federal data show.

In a November press release, Altendorf's office reported that Minnesota distributed nearly $725 million in benefits in 2020, but that total jumped to nearly $2 billion in 2021, marking a 174% increase in just one year.

"SNAP is meant to help needy Minnesotans put food on the table, not to subsidize people who already have significant financial resources," America First Policy Institute Health & Harvest Campaign Director Matt Schmid, who is also testifying on Thursday, told Fox News Digital.

"It’s unacceptable that under Minnesota’s current system, even millionaires and lottery winners can qualify for taxpayer-funded benefits. That is a fundamentally broken system."

AFPI experts argue that states can reform the SNAP program and limit budget impacts by improving oversight and closing key loopholes. They note that the One Big Beautiful Bill requires states to manage the program more effectively or take on more of the cost burden, putting states like Minnesota at risk due to high error rates. 

They also emphasize that certain loopholes make SNAP harder to administer and contribute to payment errors, and that eliminating broad-based categorical eligibility would strengthen income and asset verification.

"Reintroducing basic guardrails like an asset test is a common-sense step to restore integrity, ensure benefits go to those who truly need them, and protect the long-term viability of the program," Schmid said. "This isn’t about taking help away. It’s about making sure SNAP works the way it was intended to."

The push for tighter SNAP rules comes as Gov. Tim Walz faces ongoing criticism over major fraud scandals in Minnesota’s welfare system, including hundreds of millions in fraudulent food aid payments uncovered in recent years.

Earlier this year, Fox News Digital reported that a Minnesota woman was sentenced to about one year in federal prison for running a $325,000 SNAP fraud scheme with family members. 

Prosecutors said they used fake identities and fraudulent documents to obtain EBT cards and maximize benefits, then withdrew and sold the funds for profit. She was also ordered to repay the stolen money.

Fox News Digital reached out to Walz's office for comment on the legislation and efforts he has taken to combat SNAP fraud.