SNAP DISQUALIFICATION EBT RETAILER

The US department of Agriculture (USDA) introduced the EBT card (Electronic Benefits Transfer) to distribute the Supplemental Nutrition Assistance Program benefits (SNAP) to eligible citizens, previously known as “food stamps”. Low-income citizens are provided with EBT card to purchase nutritious foods for their household.

This card, similar though to a credit or debit bank card has a different function. It cannot be used for cash withdraw or general spending. Holders of an EBT card can use it only for the purchase of certain food items at qualified stores. Users and store owners need to comply with the rules and regulations set for the SNAP.

Not all retailers qualify for EBT benefits. Since an increasing number of the US population depends on SNAP to provide a nutritious meal to their family more store owners need to have access to EBT.

Requirements to qualify for EBT
Food and Nutrition Service (FNS) is authorized to enforce the rules and regulations set by the US code and the Code of Federal Regulations. Thus, as a store owner you submit an application, once approved, you qualify for EBT access but you need to follow all rules and regulations. Before submitting your application consult your lawyer as to make sure you do not fill in any information that may be regarded as false or misleading.

You must meet the criteria based on the following:
Your store must provide staple foods to be prepared, cooked at home. These include: vegetables, fruits, meat, poultry, fish breads, cereals and dairy products. The store must have more that 50% of its sales from such items.
The store must be accessible to SNAP holders
If your store has a lottery or liquor license it must be stated in your application
The amount of prepared, ready to eat meals your store sells is considered
The number of qualified stores in your nearby district also affects the approval of your application.

Consequences of SNAP violation
Once your application is approved you need to familiarize with all the rules and regulations as set by FNS. The USDA can monitor all transactions at any time, using a sophisticated algorithm the ALEERT system, it targets at any inconsistencies that may occur in your store’s transactions. Such transactions are undoubtedly considered as violations to SNAP and treated as such.

If or when your store is re flagged by the ALERT system, then a SNAP violation letter will be sent through USP overnight. Store owners have a 10-day time limit to respond. Do not under any circumstances take the case in your hands. No matter what the alleged violation is, consult your SNAP lawyer to do so.

PENALTIES
The penalties enforced by the USDA are quite serious and can have a disastrous impact on your business. Penalties for SNAP violation include:

Civil Money Penalty (CMP) A monetary fine that can cost you some tens to hundreds thousands. The penalty does not exceed a certain amount set by the FNS and is calculated in accordance to the regulations and your EBT store’s transaction data. The maximum amount for each case is adjusted having taken into account a number of factors as set by the USDA and based on the Federal Civil Penalties Inflation Adjustment Act. It is often preferable to pay that amount and minimize the impact of a temporary or permanent disqualification will have on your business.

But to qualify for a CMP you need to submit concrete evidence that you complied with the rules and regulations of FNS. That means you have an effective written compliance policy which includes guidelines regarding SNAP benefits and which is updated regularly based on the changes imposed by the USDA. An employee training program for EBT is compulsory at all costs, all these must be in written, signed and dated prior to the alleged violation(s).

Suspended EBT Access
Your license to have access to EBT terminal may be suspended for months or even years. This will be damaging to your business on a financial and personal level. Since SNAP clients will not be able to use your store for their purchases you will see your sales drop and your revenue diminishing. In addition, the reputation you have built up will suffer too as your business integrity is at risk.

Permanent disqualification
Permanent disqualification must be avoided at all risks and costs. This will mean the end of your business. Apart from the financial loss, you will be excluded from the System Awards Management list (SAM). You will not be allowed to maintain your business, neither to sell nor transfer it. If you do sell it or transfer it at any time in the near or far future you will receive a Transfer Civil Money Penalty (TCMP) which may amount to even more than $100,000. Furthermore, you will not be able to work for any private business that deals with the federal agencies, you will not be granted house loan and will damage your credit line too.

To avoid EBT disqualification, adhere to the rules and regulation of the SNAP at all times. Go online and check for updates as posted by the USDA. Above all, consult you SNAP lawyer for every move you need to make.