What Are the Criminal Penalties for SNAP Trafficking?

What Are the Criminal Penalties for SNAP Trafficking?

The Supplemental Nutrition Assistance Program (SNAP), formerly known as food stamps, provides crucial assistance to low-income families struggling to put food on the table. SNAP benefits are distributed on electronic benefit transfer (EBT) cards, which recipients can use to purchase eligible food items at authorized retailers.

While SNAP provides an invaluable service, some dishonest retailers exploit the program for financial gain through a practice known as “SNAP trafficking.” This refers to the illegal exchange of SNAP benefits for cash or other ineligible items. SNAP trafficking defrauds taxpayers and diverts aid from families in need, so prosecutors take it very seriously.

What Constitutes SNAP Trafficking?

The United States Department of Agriculture (USDA), which oversees SNAP, defines several types of transactions as trafficking:

• Buying, selling, stealing, or transferring SNAP benefits for cash or other ineligible items
• Exchanging firearms, ammunition, explosives, or controlled substances for SNAP benefits
• Purchasing eligible items like food or drinks with SNAP benefits, discarding the contents, and returning containers for cash refunds
• Purchasing eligible items with SNAP benefits with the intent to resell them for cash or credit
• Providing “cash back” on an EBT transaction

These transactions divert SNAP benefits away from feeding needy families, which is the sole purpose of the program. Even well-meaning retailers can engage in trafficking if they provide “cash back” on EBT purchases without realizing it violates SNAP rules.

Penalties for SNAP Trafficking

SNAP trafficking carries severe consequences ranging from civil penalties to criminal prosecution. The penalties depend on the specific circumstances of the case.

Civil Penalties

For civil violations, the USDA can impose fines or temporarily ban retailers from accepting SNAP benefits. Penalties may include:

• Fines up to $100,000 per violation
• Disqualification from SNAP for 6 months to 5 years for first offense
• Permanent disqualification for subsequent offenses or trafficking over $5,000

Losing the ability to accept EBT cards, even temporarily, can devastate a retailer’s business. These penalties are quite severe for what may have been an honest mistake.

Criminal Penalties

In aggravated cases, prosecutors may pursue criminal charges under 7 USC § 2024. This law sets penalties based on the dollar value involved:

• Less than $100 – misdemeanor with up to 1 year in prison
• $100 to $5,000 – felony with up to 5 years in prison
• Over $5,000 – felony with up to 20 years in prison

Fines up to $250,000 may also apply. Larger trafficking rings can potentially trigger charges under money laundering, racketeering, or conspiracy laws.

Real-World Examples

Here are some real cases that demonstrate how prosecutors apply criminal penalties for SNAP trafficking:

United States v. Salem

The owner of a small grocery store allowed customers to exchange SNAP benefits for cash at 50 cents on the dollar. Over 3 years, he trafficked over $1.4 million in benefits. He pled guilty to SNAP fraud and money laundering charges. His penalties included:

• 51 months in prison
• $1.4 million in restitution to the USDA
• Forfeiture of bank accounts and property involved in the scheme

United States v. Ernst

The manager of a gas station engaged in SNAP trafficking by exchanging benefits for cash and ineligible items like cigarettes. The total amount trafficked was $400,000. He pled guilty and faced these penalties:

• 1 year and 1 day in prison
• $400,000 in restitution to the USDA
• 3 years of supervised release

Avoiding SNAP Violations

The best way for retailers to avoid SNAP violations is through strict compliance measures. Recommendations include:

• Training employees on SNAP rules and prohibitions
• Monitoring inventory for evidence of trafficking
• Performing regular internal audits of EBT transactions
• Never providing cash back on EBT purchases
• Displaying SNAP rules and the fraud hotline number prominently

With proper safeguards in place, honest mistakes can be avoided. If charged with a SNAP violation, consult with an experienced attorney right away. An attorney may be able to negotiate reduced penalties or even get charges dismissed.

SNAP trafficking is a betrayal of taxpayers and hungry families relying on aid. When substantial amounts are involved, prosecutors take it very seriously. Retailers can avoid potentially devastating civil and criminal penalties by following SNAP rules diligently.