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USDA Announces Results of SNAP Compliance Reviews

Efforts to control fraud result in more than 1,000 SNAP retailer disqualifications

Published on: Jan 28, 2013

USDA Under Secretary Kevin Concannon on Friday announced results of USDA's efforts to identify and eliminate fraudulent retailers from the Supplemental Nutrition Assistance Program in fiscal year 2012.

Last year, USDA compliance analysts and investigators took action to review over 15,000 stores, conduct investigations on more than 5,000 stores nationwide, impose sanctions, through fines or temporary disqualifications, on 692 stores found violating program rules and permanently disqualify 1,387 stores for trafficking in SNAP benefits (i.e. exchanging SNAP benefits for cash) or falsifying an application.

"Our message today is clear and firm: abuse of SNAP benefits—and the American taxpayer's trust—will not be tolerated and carries severe consequences," said Under Secretary for Food, Nutrition and Consumer Services Kevin Concannon.

Efforts to control fraud result in more than 1,000 SNAP retailer disqualifications
Efforts to control fraud result in more than 1,000 SNAP retailer disqualifications

"In the coming year, we will take further steps to strengthen SNAP integrity and continue to hold accountable those few bad actors that try to take advantage of the program. We are committed to ensuring these dollars are spent as intended - helping millions of American families put healthy food on the table," Concannon added.

In addition, as part of its ongoing effort to combat fraud among SNAP-authorized retailers, USDA's Food and Nutrition Service published a Request for Information soliciting cost-effective, automated solutions from all current and potential partners to help identify fraudulent activity and exclude retailers who violate the rules from participating in SNAP.

The USDA is looking for innovative solutions which will identify connections between stores applying to accept SNAP benefits and store owners who have been previously disqualified from accepting SNAP benefits.  The RFI also seeks to identify store owners applying or already authorized to accept SNAP benefits who have business integrity violations such as a criminal conviction, a history of fraud, violations of certain laws, or a history of non-compliance with other government programs.

"Enforcing SNAP business integrity is critically important," Concannon added. "The RFI continues our efforts to look at how improvements in commercial technology may be used to obtain accurate information on ownership so that fraudulent retailers can be excluded or removed from SNAP."

Action part of continued effort

USDA continues to work with local, state and federal partners to root out fraud, waste and abuse in SNAP and ensure the integrity of our nation's most important food assistance program. Recent actions include:

-Published a proposed rule that allows USDA to not only permanently disqualify a retailer who traffics, but also assess a monetary penalty in addition to the disqualification.

-Published a final rule to establish standards and expectations regarding State matching requirements to prevent ineligible people from participating in the program. The final rule sets expectations for States to conduct matches against persons in prison, those who are currently disqualified from participating due to past program violations, and deceased persons.

-Updated the Agency's Anti-fraud Locator using EBT Retailer Transactions (ALERT) system. The re-designed ALERT system, which monitors electronic transaction activity and identifies suspicious stores for analysis and investigation, allows USDA to quickly implement fraud detection scans as new schemes are identified, better target high risk areas, and incorporate better data mining driven models.

-Helped State Agencies conduct automated searches to monitor social media websites for attempts by individuals to buy or sell SNAP benefits online. Notified state social service agencies and federal agency partners about violators to better protect our public programs. This includes information on program recipients with suspicious transactions at stores that have been sanctioned for trafficking so that the recipients can be further investigated by States.

For more information about USDA efforts to combat fraud, visit the Stop SNAP fraud website at www.fns.usda.gov/snap/fraud.