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SNAP Civil Money Penalty

SNAP Civil Money Penalty
A SNAP civil money penalty is a penalty that can be given to a retailer that’s found to be in violation of the SNAP program. It’s important to understand what constitutes a violation of the SNAP program and how much it can cost a business. The penalty can also result in the suspension or disqualification of a retailer depending on the severity and specific circumstances.

What is the SNAP Program?

SNAP stands for “Supplemental Nutrition Assistance Program” and is also commonly referred to as food stamps. The purpose of the program is to provide assistance to individuals who are in the low-income category to be able to afford healthy foods. SNAP benefits are available on a monthly basis so that low-income people are able to buy nutritious food for themselves and their families. Non-food items are not qualified in the program.

The SNAP program originated in the 1960s as a way to help people who were still struggling to put food on the table after the Great Depression. With the advancements in technology over the years, the program has evolved to provide recipients with debit cards instead of paper food stamps. This can also allow the United States Department of Agriculture or USDA, which oversees SNAP, to prevent fraud and track transactions more efficiently.

What is Considered Food Stamp Fraud?

There are a variety of types of fraud when pertaining to food stamps. However, any type of fraud committed by the retailer or a user is not using the program in the way it was intended by the government. The following includes the most common types of SNAP program fraud:

Trafficking: This type of fraud involves using SNAP benefits in exchange for cash.
False application: This type of fraud is committed when a person lies on their SNAP application to get more benefits than they’re entitled to.
Retailer lying on SNAP application: If a retailer was disqualified from the SNAP program previously for abusing it, they are disallowed from reapplying to reenter the program.

What are Civil Money Penalties?

If a business or individual is found to be in violation of the SNAP program, they can receive a civil money penalty or CMP. This is a fine that includes punitive damages that are given for unethical activity. Penalties are handed down by the civil court system.

When a retailer is found to be in violation of the SNAP program, they will receive a SNAP violation letter first to be informed of that violation. When the letter is received, the business has 10 days to apply so that it can receive the civil money penalty. Not doing so within that timeframe can automatically result in suspension from the program.

In general, a civil money penalty is a way to relieve some of the impact of a business that faces suspension or disqualification of the SNAP program. If the penalty is paid, the business can continue being eligible for the program. The fines come from the USDA and don’t exceed the amount of $59,000. The specific penalty a business receives is calculated by the USDA after it reviews its SNAP transactions.

In the charge letter, the amount the retailer owes for the violation is included, usually toward the bottom of the first page. Different factors determine the sum of each violation and its severity.

Who Qualifies for a Civil Money Penalty?

Although many retailers don’t like to pay a penalty, doing so can prevent a business from being suspended or disqualified from participating in the SNAP program. Retailers are required to meet certain criteria as per Second 278.6(i) of the SNAP Regulations in order to be eligible.

The business is required to have a compliance policy, which must be in writing in the employee handbook. Guidelines employees must follow should be clearly outlined. The policy should also be updated every time the business puts out a new edition of the handbook.

Additionally, a business’ compliance policy must have been in place prior to any violations that have been committed. There should be logs of policies and updates of those policies. There must also be a written training program that explains how and when the business accepts EBT benefits. Employees must give signatures once they have completed their training and agreed to comply with and enforce the guidelines.

Payment of Civil Money Penalty

When a retailer is given notice of the civil money penalty, the USDA gives it a short period of time where they must pay to prevent suspension or disqualification from the SNAP program. Once the business applies for the penalty and receives the letter that outlines how much is owed, it has 30 days from the date of the final letter to pay and submit pertinent documents.

If the payment isn’t received within that time frame, the civil money penalty is voided and the business is suspended or disqualified from SNAP.

How is a Civil Money Penalty Calculated?

There are specific guidelines that determine how a civil money penalty is calculated. This is found in the SNAP Regulations. Penalties businesses receive vary depending on certain factors. If a business is given a penalty, it is expected to at least pay the minimum amount of money that was gained during the fraudulent activity performed at the business.

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