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December 2016

Dec 06
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SNAP Charge transactions in short period of time

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SNAP Charge transactions in short period of time

If you have been sent a charge notice and see 2-4 transactions made by the same cardholder within a 24 hour period, the USDA’s tracking system has most likely flagged your machine for this reason.

The USDA’s thought process is as follows: If you go grocery shopping and then forget an item or two, it is understandable. You would walk back into the store within a few hours and get that last item that you forgot about the first time.

When a customer at your store purchases $80 worth of goods and then returns within a few hours to purchase another $50 worth of goods, it is suspicious to the USDA as to why somebody would return and practically do an entire new grocery shopping. The questions raised are who else is using the card? Should the store owner know that these transactions are illegal and what are the customers really buying?

One of our clients describes his clientelle’s behavior as such that once a customer makes their first purchase, the customer then asks how much money is left on their card and based on the reply, then, purchases more groceries. For this reason, they normally make a test purchase of a qualified grocery item and then plan for future purchases. Their future purchase is normally made within minutes of finding out how much money is remaining on their card.

It is most important to respond to your notice on time. There are numerous reasons as to why your customers behave the way the do. Neither one of us are psychologists or consumer behavior specialists. Call us to respond to your notice.

SNAP Charge transactions in short period of time

Dec 06
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Snap Trafficking Charges High Dollar Amounts

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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.

Snap Trafficking Charges High Dollar Amounts

Dec 06
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SNAP Trafficking Transactions ending in the same amount

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SNAP Trafficking Transactions ending in the same amount

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

  1. Transactions ending in the same amount ie. $4.88, $10.88
  2. Manually entered transactions
  3. Transactions occurring within a short time period
  4. Large transactions

What most grocery store owners do not know is that the charge letter is a result of a computer generated report. It is not the direct result of a lengthy USDA investigation or a complaint of any sort.

When the USDA sees that a store owner has transactions that keep resulting in the same dollar or cents amount, their internal controls trigger a charge. They do not take into consideration how the store owner prices their items, nor do they take into account specials that are being run by companies doing business with your store.

A common charge that we see is the special store promotion of Dorito’s and Coke for $2.50.  Obviously, purchasing two of these packages will result in a $5.00 charge.

Red Bull and Monster energy drink sales are also problematic as many store owners sell full size cases at or near $20.00 per case. For example, if a store owner sells two cases of energy drinks each at $21.00, then, even if one customer buys two cases bi-weekly, then, it is obvious that the charge of $42.00 will be reoccurring as a transaction over the course of a given month. However, this may be the cause of a charge and an investigation.

Make sure that when you sell cases of energy drinks that your customers are not reselling the merchandise. At times, some of our clients have had their customers resell their merchandise in the parking lot of the grocery store and they have had to call the police and bar them from their premises. If you have knowledge of large items that are severable (case of 20 cans that can be resold individually), then you must not sell any product by way of EBT to these customers.

SNAP Trafficking Transactions ending in the same amount

Dec 02
0

Snap Trafficking

By | Snap Defense | No Comments

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
  2. Manually entered transactions
  3. Transactions occurring within a short time period
  4. Large transactions

Each one of these categories is discussed in greater detail in separate posts on our website. It is all too common that our client 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 with our firm. However, you need to weigh the cost of having your EBT suspended indefinitely versus having things done the right way.

It’s an old saying – if you think hiring a professional is expensive, then, hire an amateur.

Snap Trafficking