The Supplemental Nutritional Assistance Program (SNAP) carries out thorough inspections of stores before offering approval for EBT card transactions. Retail and wholefood stores frequently fail to comply with these regulations, and this results in fines and suspensions from the program entirely.
Once suspicious activity is noted in your store, the US Department of Agriculture will send you a 10-day notice of the termination of the program. Within this period, you will be allowed to submit an oral or written explanation concerning the matter. This response should be sent to the Food and Nutrition Service (FNS) office that is responsible for the area where the store is located.
Stores are disqualified from the SNAP program because of many reasons. The body carries out on-site investigations and checks data from your company. Redemption data needs to be consistent for SNAP to allow you to keep transacting using EBT cards. Also, they obtain information of illegal activities through transaction reports. The exact violation committed in your store will be outlined in a charge letter sent by USDA. Sometimes, stores lose their licenses for the SNAP program because of being disqualified from the Special Supplemental Nutritional Program for Women, Infants, and Children (WIC).
Disqualification from the Women, Infants, and Children (WIC) Program
Firms that have been disqualified from the WIC program are usually barred from SNAP. In such cases, the stores have no opportunity to appeal. A common reason for disqualification of stores from the WIC program is the failure to clear outdated foods from the shelves. Also, many stores do not stock the required foods continuously. Other reasons for disqualification from the WIC program include:
• Exchanging food instruments for goods other than the specified foods. For example, stores are not allowed to exchange WIC food instruments for cash, ammunition, or drugs.
• Transacting WIC food instruments through channels other than those authorized by the body
• Overcharging WIC customers for food
Stores are usually notified that their disqualification from the WIC program will make them lose their ability to trade using EBT cards. This is done before the review of the store, and this allows SNAP to legally disqualify the store based on their disqualification from the WIC program.
The resulting SNAP disqualification will last for the same period as the suspension of the WIC Program. In some cases, it may begin later than the WIC program disqualification. SNAP does not review the store once disqualified from the WIC program.
The store may be allowed to keep its SNAP program once disqualified from WIC if the result will affect EBT households in the surrounding area.
Responding to the Charge Letter
The FNS will send you a charge letter 10 days before taking action against your store. This letter will outline the violations committed by your store and will inform you of the action you need to take to secure your SNAP license. It is advisable to contact your lawyer to build a defense for your store.
Permanent disqualifications from the program are implemented as soon as you receive the charge letter. The response may result in a reversal of the decision, although the lost income will not be refunded by SNAP.
Temporary disqualification for the first sanction can last for between 6 months and 5 years, depending on the amount transacted and the type of offense. For the second sanction, the suspension of the SNAP program can take between 12 months and 10 years.
In some cases, stores face criminal charges for trafficking. This is, however, quite rare.
A poor response to the charge letter will commonly result in a temporary or permanent suspension of your store from the SNAP program. With a proper response to the charge letter, you might be allowed to pay a civil money penalty and keep the operation of your store. This will allow you to keep the store running and gaining profits in the future. The fine is capped at $59,000.
To increase your chances of qualifying for the civil money penalty in the place of a suspension, you should ensure that your employees are well-trained on how to use the SNAP cards. The training should be documented and signed by all staff involved in the EBT transactions. It should indicate when they completed the program and details of what the training involved. Without proper dates and signatures, it will be assumed that the documents were fabricated after the charges were filed. You will still be guilty even if your employees violated the rules without your knowledge, but having the documents ready will help you build a stronger defense. If you or the management profited from the illegal transactions, your case will be a lot weaker.
It is advisable to contact an attorney to help with the documentation of the employee training. The same attorney can also help you build a convincing case if you end up being charged with trafficking or other SNAP offenses. Responding to the charge letter is a task that should always be handled by a skilled lawyer. Otherwise, you will easily get your store closed. This is important for stores that depend on EBT customers for their business.
Reauthorization for the SNAP Program
After disqualification, a store or firm can make a new application for the SNAP program. This has to be filed at least 10 days after the date of disqualification. The Food and Nutrition Service will determine whether you are still eligible for the program. Usually, your firm will be reauthorized for the SNAP program if the disqualification resulted in the suffering of many households.
Stores can apply and get approved for licenses to accept EBT cards, but this decision can be reviewed later on. You should never allow your employees to violate SNAP laws as this might lead to the permanent closure of your business. In case you receive a charge letter from the USDA, you will need to hire a lawyer to build a proper defense for your store. The response time is limited to 10 days, and your explanation can determine the severity of your penalty.