Investigators from the Department of Social and Health Services reviewed her records and found she had been reporting her only source of income as $300 per month in gifts from friends.
Rachel Dolezal, the white activist, author and entrepreneur who famously "self-identified" as black and eventually became the subject of a Netflix documentary, is now facing up to 15 years in prison for welfare fraud.
Rachel Dolezal is facing charges related to alleged welfare fraud.
KXLY reports that investigators found that Diallo had been issued a business license under multiple trade names, and that she was promoting the sale of her book, "In Full Color", along with the sale of her art, soaps, and handmade dolls.More news: Workers plugging energy wells as lava flows nearby
Documents say she had deposited almost $84,000 into her bank account without reporting it. But the DSHS report says Dolezal told investigators in April that she had "fully disclosed her information" and declined to answer further questions.
Diallo has also been hit with perjury and false verification for public assistance charges. She also was sacked from a police ombudsman commission and lost her job teaching African studies at Eastern Washington University.
She has said previously that she grew up near Troy, Montana, with religious parents and that she began to change her perspective as a teenager after her parents adopted four black children.
While she claims she had fallen on hard times after the scandal that made her a household name also made her unemployable, Dolezal was apparently still benefiting from public assistance even after things had turned around for her financially. Aside from a one-time payment of $20,000, however, Dolezal hadn't reported a "change of circumstance" to the department.