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The Supplemental Nutrition Assistance Program (SNAP) is a federal government program that provides low income families with food assistance. SNAP, which was once called the Food Stamp Program, provides a nutritious diet for more than 40 million individuals in any given month in 2017, according to the Center on Budget and Policy Priorities. Clearly, SNAP is a powerhouse. It is a staple in so many people’s lives. For so many of them, SNAP is their lifeblood.

SNAP has transformed small grocery or convenience stores into pillars in the community. Owners of such stores complete an application to become an authorized SNAP retailer. Applications are processed by the Food and Nutrition Service (FNS), which is an agency of the United States Department of Agriculture (USDA). Once approved, the retailer can expect to receive timely reimbursements from the federal government. SNAP recipients’ benefits are placed on an Electronic Benefits Transfer (EBT) card. Recipients use this card at participating SNAP retailers to purchase food. Only food can be purchased with this card. And, there lies the problem.

One day, a retailer receives a SNAP Trafficking Charge Letter from the USDA. Basically, the letter alleges that an investigation into the store’s EBT activities has been conducted and that it has been determined that the store has committed fraud, which is illegal. Evidence has been gathered by analyzing the store’s EBT data. Generally, such a letter is automatically generated when one of the following events occurs:

• The USDA’s computer system flags what is perceived to be an unusually large amount. The USDA does not define an amount that is considered to be too large. However, it is believed that $40.00 or more will trigger this event.

• The USDA flags transactions of even dollar amounts. For example, amounts like $25.00, $14.00 and $35.00 will be flagged because they have a zero-cent value on the end. In this case, a letter will not be sent until this event occurs a specific number of times. Although the USDA does not divulge the number, it is believed to be approximately 100 times, over a three-month span. Also, the cent value can be any number, as long as it is repeated numerous times.

• The USDA’s computer system flags transactions that occur within a short period of time. The USDA does not define short. However, 36 hours is believed to be the time frame. Transactions that occur within minutes of each other will surely be flagged.

• The USDA flags transactions that are manually entered. As far as USDA is concerned, not swiping an EBT card clearly indicates that the recipient does not have it in-hand, which constitutes fraud.

So many SNAP retailers find themselves in legal trouble with the USDA for committing fraud in the form of trafficking. Allowing the purchase of nonfood items with SNAP benefits constitutes trafficking. Trafficking also involves the selling of SNAP benefits for cash. Such violations can have a detrimental effect on a retailer’s business. A retailer could be fined, imprisoned or permanently barred from performing EBT transactions. Not being able to accept SNAP benefits could ruin a business.

For this reason, a SNAP retailer should immediately contact an attorney when the Trafficking Charge Letter has been received. Timing is pivotal. An attorney can immediately inform the retailer that the allegations are not set in stone and thereby can be refuted and overturned. At this point, the retailer has three options. It can be proven that the store is not involved in trafficking by surveillance video and customers’ testimonies regarding their buying habits. Or, the allegations can be appealed via a lawsuit. Or, it can be determined if the store qualifies for a civil monetary penalty, which must be requested 10 days after the retailer receives the Trafficking Charge Letter. A civil monetary penalty allows the retailer to pay a fine instead of being permanently disqualified from SNAP. However, the key to a civil monetary penalty is having evidence of a pre-existing SNAP training and compliance program. Having such programs already in place would suggest that an employee committed the trafficking violations without the retailer’s knowledge. At least this way, the retailer’s permanent disqualification can result in a reversal.

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