Food stamp benefits have been yanked from six recipients who intentionally exceeded spending limits during a multistate computer system crash in the fall, the state Department of Children and Family Services announced Monday.
Another 25 Supplemental Nutrition Assistance Program recipients are in the process of being disqualified for at least a year while hundreds of others are undergoing review for potential penalties, said Lindsey deBlieux, spokeswoman for the Department of Children and Family Services. The Supplemental Nutrition Assistance Program is the food stamp program.
DeBlieux said the agency is concentrating on about 500 electronic benefits cardholders who spent $315,386 that they did not have available in benefits on the day the computers crashed. The amounts ranged from $300 to $2,000, she said.
Federal guidelines state that a first-time SNAP violation will result in a 12-month disqualification from the program; a second offense carries a 24-month disqualification. Third offenses will result in permanent disqualification from the SNAP program.
DeBlieux said the six disqualified are first-time offenders. The action against them does not preclude food stamp benefits from going to their household, she said. For instance, if the benefit covered a mother, father and three children, and one of the parents improperly used the card, the benefit would be reduced to cover four in the household instead of five, she said.
Word spread after the electronic tracking system failed, prompting a shopping frenzy at Wal-Marts in Springfield and Mansfield in north Louisiana.
Neither state nor federal funds were lost, but Wal-Mart did lose money because there were insufficient funds on the card to make the purchases. The retailers are responsible for the cost of any nonsufficient funds transactions.
The state can disqualify food stamp recipients, but criminal charges for fraud would have to be filed by the retailer, deBlieux said.
Questions about whether Wal-Mart intends to pursue legal action posed to the company headquarters media relations office were not answered.
Immediately following the Oct. 12 incident, the state agency began reviewing transactions made by 12,000 clients and determined that some were made by people who were no longer eligible for the program or who did not have sufficient funds in their balance to pay the retailer for the goods purchased.
Gov. Bobby Jindal pledged to hold those accountable responsible, while U.S. Sen. David Vitter pushed for state action and charges to be filed against offenders. Vitter said action was not being taken swiftly enough.
On Monday, Vitter’s office issued a terse statement: “The first question I’ll ask is why are there only six people getting punished when they say there are over 12,000 people who overspent. Like many citizens, I am appalled by the outrageous theft and fraud and believe there should be serious consequences for what occurred.”
Vitter is scheduled to meet with Attorney General Buddy Caldwell and DCFS Secretary Suzy Sonnier on Friday in Baton Rouge about the situation.
DCFS’s Fraud and Recovery Unit began pursing the 500 most egregious transgressors. The agency sent target letters and questionnaires to those 500. As of Feb. 20, the agency has received 113 responses and scheduled 109 interviews.
“Responses to the disqualification letters have ranged from admitting to committing the fraudulent transactions, to declaring no knowledge of the transactions, and to stating that the retailer told the clients it was ‘OK’ to perform the transaction because ‘the government was shut down,’ ” Sonnier said. “Regardless of circumstances, knowingly attempting to spend more than the balance on your card or allowing others to do so is grounds for disqualification.”
Based on the returned questionnaires and evidence collected, the agency’s fraud unit initiated the necessary process to terminate benefits for 31 clients through an Administrative Disqualification Hearing. Six violators chose to waive their right to a hearing and will be disqualified beginning March 1.
DCFS has shared the information it has gathered with state law enforcement officials, including the Louisiana State Police, the state attorney general and parish district attorneys so officials can begin their own investigations to determine if any criminal laws were violated.