Food stamps at farmers' markets: invitation for fraud?

05/14/2012 01:46:00 PM
Tom Karst

From that story:

In 1998, the U.S. Department of Agriculture (“USDA”) authorized Stryker Avenue Market to accept food stamps, and Ansari affirmed that he had attended retailer orientation and understood the rules regarding the federal food stamp program. Each individual who receives SNAP benefits is issued an electronic benefit transfer (“EBT”) card, which contains a monthly allocated benefit amount that can be used at authorized retailers. The USDA then reimburses those retailers for the benefit amounts redeemed. Only eligible food items may be acquired with food stamps, and some items, such as alcoholic beverages, tobacco products, and cell phone minutes, are strictly prohibited. Moreover, food stamps may not be redeemed for cash.

The USDA-Office of Inspector General (“USDA-OIG”) began investigating Stryker Avenue in 2008. On numerous occasions, Ansari admittedly exchanged SNAP benefits for cash or ineligible items. For example, on July 16, 2008, Ansari swiped a person’s SNAP EBT card for $401.12 and provided that person with $200 in cash. Then, on January 7, 2010, Ansari swiped another person’s card for $131.86 and provided that person $100 in cash. According to a law enforcement affidavit filed in the case, between 2004 and 2009, the average annual food stamp redemption for a similarly sized store in Minnesota was approximately $322,793. In contrast, during that same period, Stryker’s annual redemptions totaled approximately $3.1 million.

 

TK: So this retail store may have been corrupt for years, but the USDA only was able to prosecute it ten years after it was authorized. And fraud from one retailer totaling $3.1 million in five years: mind-boggling!

As much as we assign a "halo" for local foods in general and farmers' markets in particular, the agency should carefully consider the fraud prevention plan in place for each market.

After all, it is not as if being a merchant at a farmers' market absolves one from the temptation to defraud. Don't we recall that some merchants at an LA farmers' market have been known to peddle fruits and vegetables from other states as "home grown" or "local." One Kansas farmers' market was hit with allegations of price-fixing in the way the rules of the market are set for vendors.



Comments (1) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left

Jeff Genitempo    
Dakkas  |  May, 18, 2012 at 02:39 PM

By your appearance you don't look like you have been on Food Stamps. A few bad apples does not spoil the bushel.

Feedback Form
Leads to Insight