The Jindal administration vowed late Wednesday to strip food stamp benefits from recipients who misled retailers about their spending limits during a technical malfunction.
Recipients who walked away with groceries that exceeded their food stamp balances face losing their benefits for a year, two years or permanently depending on how many prior infractions they have. Exactly how many stand to be punished is unclear. More than 12,000 transactions generated insufficient funds notices once the electronic benefit transfer, or EBT, system came back online Oct. 12 and retailers could process stored transactions.
However, retailers might have repeatedly run transactions through in an attempt to get payment on groceries sold when the system was down.
Suzy Sonnier, secretary of the state Department of Children and Family Services, said the Jindal administration will start with the most egregious cases first.
“We must protect the program for those who receive and use their benefits appropriately according to the law. We are looking at each case individually, addressing those recipients who are suspected of misrepresenting their eligibility for benefits or defrauding the system,” Sonnier said in a prepared statement.
Sonnier’s announcement came just days after U.S. Sen. David Vitter urged the Jindal administration to take action in a national news story that unfolded with the help of smartphone technology. Shoppers snapped images of empty store shelves and bulging grocery carts at Wal-Marts in Springhill and Mansfield.
However, abuse of the system apparently occurred across Louisiana.
“The recent over-the-top food stamp theft and fraud gave Louisiana and the program a real black eye. I’m certainly glad the state is acting on my urgent suggestion. I look forward to discussing the details with Secretary Sonnier in my upcoming meeting with her and Attorney General (Buddy) Caldwell,” Vitter said in a prepared statement.
Technical problems with the electronic benefit transfer system impacted 17 states, including Louisiana. Food stamp recipients receive debit-style cards that are supposed to work like a check card. More money cannot be spent than is on the card.
When the system goes down, retailers are supposed to limit food stamp recipients to $50 in groceries. Some retailers simply turned away food stamp recipients. Others allowed them to buy as much as they wanted and stored the transactions to process when the system rebooted. The retailers that ignored the emergency protocol lost countless dollars.
The breakdown generated confusion about who could punish the abusers. Taxpayers did not lose any money. Retailers suffered the losses.
In Springhill, police detained a woman who pushed a cart with $700 in groceries up to a cash register despite having less than 50 cents on her food stamp card. Wal-Mart instructed police to release the woman without citing her.
The Many Police Department posted this week on its Facebook page: “Apparently after reviewing surveillance tapes and interviewing witnesses, Wal-Mart has no evidence of any theft, nor any other criminal activity during the October 12th disturbance at the store. With this information, the Many Police Department has closed the investigation at this time.”
The Jindal administration said Wednesday that problems occurred with people who spent more than their balances and with people who weren’t even eligible for food stamps.
Violators can expect to get a letter about disqualification along with an offer to appeal through an administrative hearing.
Anyone who waives or loses an appeal will lose food stamp benefits for as little as a year and as much as permanently depending on the number of prior offenses.