Her Conduent Debit Cards Have Been Hacked Three Times; Why Is Illinois Using Company With Bad Reputation To Pay Her?
CHICAGO (CBS) -- A big fat F: That's how the Better Business Bureau rates a company repeatedly hired by the State of Illinois to handle some payments.
The Morning Insiders' Lauren Victory takes us inside the case of a Chicago babysitter who says her hard-earned money continues to be snatched by fraudsters who have been able to hack the debit cards the company uses to pay her.
Annette Barnes is a home daycare provider who is paid by the state for babysitting through the "Go Program." Unfortunately, her debit cards have been hacked three times.
In July, her money began to mysteriously disappear. Someone siphoned out nearly half her pay in repeated $10.61 increments.
"I called and I asked, 'What are all these charges?' They said, 'It's from an Xbox. Microsoft.' Microsoft? I said, 'I don't have any of those. I don't use that,'" Barnes said.
A replacement card didn't help. Hackers hit as soon as she activated it.
"I had never took the strip off," she said. "How can they get in my account, and I had never used this card before?"
She started with $770 on the card this time, but within a matter of hours, she said that was down to about $490.
"By the time I canceled the card, the amount was down to $294," she said.
Barnes is hardly the only Way2Go card user victimized by fraud. There have been similar complaints across the country about the system's parent company, Conduent.
In 2018, a state benefits recipient in Georgia filed a class-action lawsuit against Conduent.
The company also currently corks an F rating by the Better Business Bureau after more than 150 customer complaints.
"I've had it with their system. Their system sucks," Barnes said.
Despite those problems, Illinois continues to hire Conduent. State contracts show the state is on track to pay the company nearly $54 million for three years of service.
For its part, Conduent's "Go Program" appears to have an entire department dedicated to investigating fraud, but in Barnes' case the company won't accept responsibility, telling her in a letter it can't confirm fraud occurred.
Barnes is out $900, but she opened a new bank account to receive future benefits through direct deposit.
CBS 2 asked the Illinois Department of Human Services and the Illinois State Comptroller's office why the state would continue to use Conduent.
Comptroller's Office Director of Communications Abdon Pallasch replied: "We are glad you brought this to our attention. If the charges you have outlined against this company are true, the state should not be doing business with it. We will be looking into this."
State sources said about 9% of payments made to IDHS child care providers are made through Way2Go cards, but most receive payments through direct deposits and checks.
A spokesperson for the Illinois Department of Human Services said Conduent went through a competitive bidding process and scored the highest and had to pass a technical test that included providing information about its security policies.
The Department of Human Services also issued a statement saying it wants to ensure child care providers receive payments for their work, and any claims of fraud through its debit cards are "taken very seriously."
"Debit cards are administered by the provider, Conduent, and fraud claims are investigated directly by the provider. Most claims of fraud are brought directly to Conduent, but in cases where claims are brought to IDHS, we immediately share this information with Conduent," the IDHS statement said. "In this case, we have already shared this information to ensure Conduent can conduct an investigation and take appropriate action. We have not seen a recent uptick in fraud claims received directly to the department."
The class action lawsuit against Conduent claims the company conducts "sham investigations" and improperly denies claims of fraud.
A Conduent spokesperson said the company strongly denies the allegations in the class-action lawsuit filed in Georgia but declined further comment on pending litigation.
"The privacy and security of cardholders' information is critically important to Conduent, and we have strong measures in place for our clients to prevent fraudulent activity, complying with all regulations and in line with industry standards," Conduent spokesman Neil Franz added. "We do not comment on individual claims. However, we take all reports of suspected fraudulent activity seriously and thoroughly investigate each and every claim."