Louisiana (KMSS) — The Louisiana Department of Children and Family Services (DCFS) announced today it will seek to disqualify Supplemental Nutrition Assistance Program (SNAP) recipients who are suspected of intentionally using their EBT (electronic benefit transfer) cards to make purchases that exceeded the available balance during a multi-state Xerox EBT system failure on October 12. DCFS will pursue these suspected recipients through the administrative hearing process.
DCFS Secretary Suzy Sonnier said, "DCFS has no tolerance for fraud or misrepresentation of benefits. We are in the business of helping vulnerable families, and 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, and the Department will take initial action against the most egregious cases first. The investigation is ongoing, and DCFS is committed to addressing those people who tried to intentionally and grossly misuse taxpayer dollars."
As a result of the outage, DCFS' Fraud and Recovery Unit received details of approximately 12,000 non-sufficient funds transactions conducted while the system was down. Many of these transactions were made by people who were no longer eligible for the program or who had much lower balances available to them than what was spent through the transaction. The Fraud and Recovery Unit continues to investigate the transactions and compile a list of recipients who performed transactions in excess of the available balance on their EBT cards or misrepresented their eligibility for benefits. The Unit will initially target the most egregious violators through the following administrative process:
Suspected violators will be mailed a letter stating DCFS' intent to pursue disqualification of the recipient. The letter will include a brief summary of the issue, the recipient's SNAP balance prior to the transaction(s), the actual transaction(s) that exceeded the available balance and a list of the retailer(s) where the transactions took place. The policies violated will also be identified in the letter.
The recipient will be informed that they can appeal this action within 90 days through an Administrative Disqualification Hearing. If a hearing is requested during that time, DCFS' Fraud and Recovery Unit will request that a hearing be scheduled through the Louisiana Division of Administrative Law. All hearings administered by the Division of Administrative Law are conducted by independent and impartial Administrative Law Judges.
Recipients also can waive their right to appeal by signing and returning a Waiver of Administrative Disqualification Hearing Form that will be included in the letter sent by DCFS. The Fraud and Recovery Unit will impose disqualification upon receipt of the waiver.
If the recipient fails to return the form waiving their right to an administrative hearing, DCFS will schedule an Administrative Disqualification Hearing for the recipient.
Recipients who waive their right to hearing or have their case upheld during an Administrative Disqualification Hearing will be disqualified. Federal guidelines state that first time offenses will result in a 12-month disqualification from the SNAP program. A second offense will result in a 24-month disqualification from the SNAP program. Third offenses will result in a permanent disqualification from the SNAP program.
DCFS does not assume that every person who conducted a transaction during the October 12 outage intentionally committed fraud or a program violation. As with any other fraud investigation, DCFS is looking at each case individually and will proceed accordingly.
No unauthorized taxpayer dollars were used in Louisiana during the multi-state Supplemental Nutrition Assistance Program (SNAP) EBT transaction outage. Numerous retailers across the state chose not to follow DCFS' established emergency processes during the outage and continued serving customers, saving transactions until connectivity was restored. The state publicly notified retailers on October 14 that they would be reimbursed only for transactions at or under the balance on the card. Transaction attempts over the available balance on the EBT cards were returned as non-sufficient funds and will not be reimbursed.