SNAP Violation: Expert SNAP Disqualification Defense

A Metropolitan Law Group SNAP Violation Representation Result

Reversal of a Permanent Disqualification

FOR MORE THAN TWO DECADES, a small grocer in Lexington, Kentucky participated in the Supplemental Nutrition Assistance Program (SNAP) as a retailer.  The store had never had a SNAP disqualification letter before, or so much as a SNAP violation warning letter.  When the small grocer began participating, the program was based around physical food stamps exchanged for eligible food items, like fruits & vegetables.  But over time both the program and the grocer shifted to accepting payments with an EBT machine.  As the years passed, the grocer became a neighborhood staple.  In order to grow further he offered even more foods that were SNAP eligible.  In response, the local residents turned into regular customers of the store.  The small grocer's business flourished.

Three and a half years earlier... an on-site investigation of the retailer's store was conducted by the USDA's Office of Inspector General.  This agency is responsible for law enforcement and regulatory enforcement.  They seek out stores involved in intentional program violations on behalf of the Federal Government.  They conduct undercover investigations, posing as SNAP household members looking to commit program violations.  These investigations are conducted over a period of time, using multiple benefit cards to thoroughly test the retailer's compliance.

However, the purpose of these investigations is to find criminal behavior.  They're not intended to deal with the retailer's compliance with SNAP regulations.  Because of this, the investigators do not document their cases as well as they should, and the delay between the allegations and the charging letter is considerable.  The delay is burdensome to the retailers.  If allegations occur too far in the past, the retailer has no records of the transactions that are in question.

So, our store owner had operated his business for a number of years, having no idea that the USDA ever felt there was something wrong.

The SNAP Violation Charge Letter

In February, the store received a SNAP violation Charging Letter from the United States Department of Agriculture (USDA).  The letter informed the small grocer that his store had been investigated for a SNAP violation, and that the store was found to have trafficked in SNAP benefits.  The Department wanted to impose the maximum disqualification penalty: permanent disqualification.  The USDA set forth two specific allegations:

  • SNAP Violation: Trafficking in SNAP Benefits

    The USDA alleged that 3.5 years prior to the Charging Letter, the store provided an undercover investigator with $100 in cash for stolen SNAP benefits.  This transaction allegedly involved the purchase of an EBT card by one of the store's employees. The Department claimed that this activity was trafficking of SNAP benefits, and that the store would be permanently disqualified.  According to SNAP violation regulations, this is the most severe offense that the USDA charges.

  • SNAP Violation: Sale of Major Ineligible Items

    The USDA also alleged that three years prior to the SNAP Charge Letter, the store had sold a single can of beer to a SNAP participant using EBT funds.  This sale, according to the USDA, amounted to an unauthorized sale of ineligible items.  An offense like this would result in a suspension of the store, often between three and five years.  Major Ineligible items include beer, tobacco, non-food related items (like electronics), or other merchandise that is obviously not intended for food or food preparation.

Answering the SNAP Violation Charge Letter

The small grocer responded the USDA's Charging Letter with a strong denial of the charges.  Just as the owner had dealt with state and local authorities, he believed he could handle answering the USDA's EBT charge letter.  He mentioned to the Department that it was impossible for the store to address a specific transaction though because the Department never provided much information about the actual alleged violation.

There were no names of clerks who had allegedly conducted the transactions.  The letter did not contain pictures of the items or the store.  There was nothing but a few sentences accusing the store of the worst violation.  So, the grocer explained, it wasn't possible that these things could have occurred at his store.  He had spent decades in compliance with the rules.

Unfortunately for the store owner, he had not read our guide for answering Charge Letters.  To summarize our guide, a store owner cannot win against the USDA's charges by simply responding to the letter.  Retailer responses that merely state all sales were for an eligible food item is not enough for FNS.  Instead, and depending upon the charges, there are a variety of different documents, statements and strategies that aren't obvious to store owners or attorneys who don't practice SNAP violation law.

A few weeks after the small grocer had submitted its reply to the USDA, he received a letter from the USDA saying that he and the store had been permanently disqualified.  The Department had decided to ignore his denial.  Instead, the USDA relied solely upon the few sparse paragraphs of allegations in its own letter.

That same day, the USDA turned the store's EBT machine off.  The small grocer was suddenly and inexplicably without the ability to accept SNAP.  Its customers were disappointed, and the store started immediately losing business.  A business that had been family run and operated for more than two decades was on the brink of collapse.

Metropolitan Law Group's Appeal

EBT Attorney Andrew Tapp, Esq. of Metropolitan Law Group, PLLC, was retained by the small grocer to draft an Administrative Appeal of the USDA's permanent SNAP disqualification.  After a review of the USDA's work, it became immediately apparent that the Department had made a severe mistake.  No SNAP violation had occurred and the retailer was innocent.  The reason the Department could not give more details about the allegations was that they didn't have any.  They had made a decision to disqualify the retailer simply because they had heard about the investigation report, and even though they had never even spoken to the investigator.

In this instance, the Department had relied too heavily upon the vague and unsubstantiated allegations.  Though the USDA is very interested in disqualifying retailers, they do not have the right to simply suspend retailers because they feel like it.  Nevertheless, the USDA refused to back off of the permanent disqualification, so the administrative appeal moved forward.

In a 24 page appellate brief, Mr. Tapp outlined the deficiency in the USDA's permanent disqualification of the small grocer.  Due to our database of case law & experience, the brief was well documented and thorough.  As a result, he was able to set out not only the scope of the USDA's error, but also outline a fundamental problem with the Department's internal process.

Less than two weeks after the Appeal Brief was submitted to the USDA by Mr. Tapp, the small grocer received a new letter in the mail.  The letter was brief but straight to the point: the Administrative Review Officer agreed with Mr. Tapp's analysis and completely withdrew the permanent disqualification.

The small grocer and his store, a neighborhood staple, was able to revive the business and regain the lost EBT license.

What To Do With A Permanent SNAP Disqualification

The most important thing for a retailer who has lost their EBT license to do is to consult with a knowledgeable SNAP disqualification attorney.   Good legal advice is important, which is why we offer store owners a free consultation.  There are a number of different types of disqualifications and SNAP charge letters, and each has a different strategy and process for representation.  As soon as you receive your letter, reach out to us to schedule a free SNAP disqualification letter consultation with our EBT attorneys.  There is a ten (10) day limit to respond to a disqualification, and every minute counts to help your case.

SNAP Violation
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