SNAP Violation Attorney

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SNAP Violation Lawyer Mansoor Ansari

If you are a store owner that has been charged by the USDA with SNAP trafficking of benefits, your first instinct might be that it was your employee and not you. I would think the same way had I not defended hundreds of SNAP violation cases.

As an attorney that deals with SNAP violations, I have seen employees selling ineligible items, majorly in eligible items, and sometimes even giving out cash in exchange for benefits. As a store owner, your job is to make sure that your employees are properly trained using the EBT machine in order to avoid suspension and or permanent disqualification.

Make sure to watch our videos on civil monetary penalties and SNAP violations. The tips on the videos are given to people who have either been cited for violations and or people that simply want to protect themselves in the future.

CMP: A civil monetary penalty is sometimes your only option. Unfortunately, after the violations have already been carried out, your best option may be to pay a penalty and move forward, if the USDA allows this to happen.

6 month suspension: losing six months worth of EBT customers could be devastating. Sometimes proving a hardship to the community might be a great option.

The ALERT System

The ALERT system analyzes millions of SNAP transactions and assigns ratings to businesses based on the number of unusual transactions they process. Unusual transactions can include sales volumes that are much higher than those at neighboring stores, multiple withdrawals from the same card over a short period of time, multiple purchases that end in the same number of cents, or very frequent or large purchases.

Most store owners have a practice of letting customers purchase food on credit — which results in one-time payments of hundreds of dollars when they clear their accounts — it up in the system as an atypical pattern and initiated his disqualification from the program.

THE USDA ARGUES that the ALERT system is one tool among many in a thorough disqualification process. “When [the USDA] suspects a store may be committing SNAP violations, staff will carefully review the store information including SNAP redemptions, any history of complaints, the owner’s history in the program, and store visit records which include photos and details of the store and inventory,” a USDA spokesperson wrote in an email statement. “If, after review of all the information gathered, [agency] staff believes further investigation is warranted, they (not the ALERT system) will initiate a compliance review — which may include further investigative analysis or an undercover investigation — and if warranted, charge the store with violations.”

However, the USDA section chief testified that the “investigative analysis” referenced in the agency’s emailed statement is based primarily on ALERT data. And there’s little leeway if a grocer is deemed to have violated the rules: According to decisionsOpens in a new tab posted to the agency’s own website, retailers can be disqualified with no prior violationsOpens in a new tab and decades of successful participationOpens in a new tab in the program.

Standard of proof: Preponderance of the evidence

This is a very flimsy standard of proof when you are wagering whether or not to disqualify somebody from the EBT program and essentially destroy their business. Essentially, if it is simply “more likely than not, that trafficking has occurred at the store,” then, you may be found guilty of trafficking.

Snap Trafficking

The most common charges that our clients receive from the USDA are:

1. Transactions ending in the same amount ie. $4.88, $10.88. You need to ask yourself, can this logically happen?
2. Manually entered transactions. How many of your customers have damaged cards? Are they present while this information is being entered?
3. Transactions occurring within a short time period (within minutes or even seconds apart). Make sure to look for errors in the report such as transactions that seem to be close together in terms of time, but the dates are entirely different.
4. Large transactions – are they really that large based on your store’s inventory?  If you have a bodega and have transactions above $60.00 that is questionable. However, if you have a grocery store, then even $160.00 is a possibility.

Each one of these categories is discussed in greater detail in separate posts on our website. It is all too common that our clients will receive a 10-day notice, then, they will either themselves write a defense letter or get somebody not properly trained to respond to a USDA SNAP Trafficking charge letter and then come to us when their position is rejected. Obviously, as an Attorney dealing with SNAP and the USDA, we know that paying any Attorney legal fees for something out of the ordinary is something that most clients do not want to do. You will have to pay legal fees to our firm. However, you need to weigh the cost of having your EBT suspended indefinitely versus having things done the right way.

My employee did it, not me!

When you have violations at your store, the onus falls on the owner. Most of our clients tell us that it was not them who engaged in the violations, rather, it was their employee. This does not translate into a clear win, but it helps tremendously if it was not the owner.

In one of our cases, the store clerk, who is also an employee, was approached by a young and attractive woman. Said woman was an undercover USDA agent. The employee was trying to impress and create a relationship with this woman. At that point, he created a contract that the woman would purchase items on her EBT and then sell them to him at a lower price.

The employee was successful in creating the contract as well as getting his employer charged with trafficking SNAP benefits.

Overly aggressive USDA, undercover agents:

We have heard numerous stories of undercover agents, creating such a ruckus at the target store, but the store clerk has no other choice than to agree with an undercover agent in order to run their business.

The following court case deals with entrapment. Entrapment can be defined as an instance where the government agent seduces and induces an otherwise non-willing participant. But for this entrapment, the individual would have never engaged in the illegal activity.

SNAP-EBT training to avoid penalties

The Food and Nutrition Service (FNS) has sent out text messages reminding authorized users to stay up to date on proper SNAP-EBT training to avoid penalties. The texts went out Thursday, November 16, and will continue through today, Friday, November 17.

According to the website, “[FNS] expects Supplemental Nutrition Assistance Program (SNAP) authorized stores to have an established, operational compliance policy and program in place to prevent SNAP violations from occurring. Our goal is to ensure that all store owners fully understand and appreciate this responsibility and are aware of training resources.”

Adequate training includes:

A thorough review of FNS training materials and program rules
Documented initial training
Documented refresher training
Authorized users will receive the following text: “USDA: Make sure your staff is trained on SNAP-EBT rules. Learn more: fns.usda.gov/snap/retailer-reminder-training.”

SNAP customers are important to c-stores, and NACS is fighting for hot foods to be SNAP eligible items.

Americans relish the flexibility to purchase hot meals—such as a rotisserie chicken, soup or a hot sandwich—as they juggle multiple responsibilities. Americans who depend on SNAP need that type of flexibility as well. In fact, of the more than 42 million SNAP participants, approximately 70% are children, elderly or have disabilities. Removing the hot foods restriction is a commonsense update to modernize the program.

The Hot Foods Act (H.R. 3519) was introduced in the House with bipartisan support. NACS strongly supports the Hot Foods Act and removing the SNAP hot foods restriction in the upcoming Farm Bill.

Snap Trafficking Charges High Dollar Amounts

PAGE 7 OF THE SNAP MANUAL – RESPECT YOUR SNAP CUSTOMERS

Under this section, store owners are not allowed to restrict the time or purchase amount of its customers.

Is it not ironic that the SNAP manual written by the USDA tells you not to question your customers, but then they will send you a charge letter for having high-dollar sales?

Many of our clients sell large-dollar items such as raw meat, baby formula (Similac and Enfamil), and energy drinks at their stores. Now, couple that with large families such as in the West side of Chicago where you have a minimum of 4 kids per family and you now have a very high bill per customer.

The problem defending our clients starts when they cannot provide any documentation to support these claims. It is not a matter of obtaining sworn affidavits from customers, rather, it is a matter of producing your cost of goods purchased and matching them to z-tapes to support your claim that you have had to stock your store with expensive per item merchandise and that you actually sold that product.

Now, going back to page 7 of the SNAP Manual – Respect your SNAP customers – how is this possible when you have to make them legitimize their need for using their EBT card at your store to make a purchase? It is an impossibility to please the USDA and your client.

Administrative Appeals for USDA Snap Violations

Not responding to a letter is similar to that of any other default. You will get assessed in favor of the USDA and be responsible for the penalties and be disqualified from the program.

The difference between an initial charge response and an administrative review case is that in the latter, there will be more in terms of agency review as well as the length of time in closing a case. If you are already in an administrative review, you have probably already seen the response letter in the first case. It was most likely one and a half pages at most with boilerplate language. Did it sound like this: “Consideration has been given in your case. The USDA finds that it is more likely than not that trafficking has occurred at your store. Therefore you are being permanently disqualified from the EBT program.”

The outcome and/or judgment handed out in an administrative review case is anything but concise. The Agency analyzes each and every argument as well as the supporting documentation. They simply do not send a generic letter telling you that you lost.

Store credit – is this even legal? Actually, no.

Store credit is the most common issue giving rise to numerous transactions in a short period of time. Normally, a customer of our client will run a tab with the store when they run out of money on their EBT cards. The customer will wait until they get a replenishment of their benefits by the USDA, then, they return to our client’s store to clear their balance. It basically happens like this:

1. Customer runs a balance

2. Customer comes back to the store and goes shopping

3. Customer pays off their balance from the previous month

4. Within seconds the customer makes a new purchase.

For this reason, there are two transactions within a very short period of time that call into question whether or not our client is trafficking in benefits. While trying to appease your customers, you are running the risk of a permanent disqualification that comes with a $59,000.00 penalty. If you are giving store credit on EBT, you must stop doing this immediately.

Transactions ending in the same dollar amount?

We normally see charge letters that have transactions ending in .00 or .99. The question is why is this happening? Does it seem normal that customers would enter your store and have numerous charges ending in the same cent value? Ask yourself these questions.

We have heard from a lot of our clients, that their SNAP customers normally negotiate a deal on their groceries. A client of ours told us about a customer whom they nicknamed “$40 Rich.” $40 Rich would come into the store and only buy $40 to $45 worth of goods. He had already negotiated a price of $40.00 with our client, so his transactions would only end in the same dollar amount. If you see anything irregular, always remember to make some kind of note and be prepared to submit documentation to justify these types of transactions in case you get charged with trafficking SNAP benefits.

In another case, we had a client that was a Burmese refugee. He opened a small grocery store in his State that attracted individuals from 100 to 200 miles away. To make it worth their drive, he prepared ready-made boxes full of bread, candies, and other EBT-qualified items that are commonly purchased by people of Burmese descent. He sold each box for $55.00, which resulted in numerous transactions of $55.00 and $110.00 (when someone purchased two boxes at a time). Again, make sure to document large transactions and be prepared to produce z-tapes.

Are the transactions large based on the observed store characteristics?

Basically, the USDA is saying that your store looks too small to have such large sales. They will not take into account your storage space or even if you keep inventory off site.

Undercover agent investigation

The other SNAP violation letter is a collection of 3 to 4 instances where an undercover agent has solicited illegal favors from your store clerk. Each exhibit will show the ineligible EBT items that were sold or not sold. Here is the key:

M = Majorly ineligible item (non-food, non-household)

E = Eligible item (EBT qualified)

R = Refusal (your store clerk refused to sell the undercover agent this item)

F = Free (your store clerk gave away the item for free instead of committing a violation)

There is an explanation of the event with each instance of trafficking. For instance, the undercover agent will explain the conversation that they have with the store clerk. This conversation may be helpful. For instance, if your store clerk clearly states that “this is against the store policy.” Conversely, this conversation can be devastating to your case if the store clerk says “let me call my boss and ask them because they usually allow for this illegal activity at  night.” Questions to ask here are:

1. Was the store clerk the owner?
2. Did the store owner authorize such activity?
3. Was the store clerk trained?
4. Was the store clerk coerced by the USDA’s agent?

10-day Notice

A charge letter, pursuant to 7 C.F.R. §278.6(b), sets forth the violations of SNAP the FNS alleges your firm committed and provides evidence supporting those allegations, such as Electronic Benefit Transfer (EBT) transaction records. A store is entitled to respond to these allegations within ten (10) days of receipt of the charge letter before the FNS can make a final determination. This ten-day period is crucial in the defense against a SNAP violation.

Is this 10 business days or 10 calendar days? Many of our clients erroneously believe that the 10 day notice does not include Holidays and/or weekends. The correct answer is that the deadline to respond with a properly drafted petition is within 10 calendar days. Again, calendar days is inclusive of weekends and Holidays. The only concession that you get is that if your due date falls on a Sunday, then, you can file your case the next day, on Monday, and it will be deemed timely filed.

Make sure to contact an attorney that deals with SNAP violations.

New York, California, Georgia, Texas, Pennsylvania, Illinois, New Jersey, North Carolina, and Florida commonly see the most SNAP violations. The plain and simple reason is that they have the most stores. More stores and more people equal more transactions.