EBT Trafficking Unit investigates vendor fraud

The OIG Electronic Benefits Transfer (EBT) Trafficking Unit investigates allegations of retailers' misuse or trafficking of Supplemental Nutrition Assistance Program (SNAP) benefits. These activities can erode public trust in a nutrition program with more than 3.5 million eligible participants in Texas. In the third quarter of fiscal year 2022, the trafficking team opened 93 cases, completed 94 cases and recovered $272,279 in overpayments.

EBT Trafficking Unit members continue to receive a high number of referrals from the Houston area, reporting that mobile vendors are making unauthorized transactions on clients' accounts. The trafficking team has also received information that EBT cards are being skimmed and cloned, allowing the removal of funds from a client's account without approval. In addition to monitoring growing types of benefit fraud, the trafficking team continues to conduct inventory reviews and on-site inspections and deploy additional investigatory tools to maintain the integrity of benefit programs.

During an undercover operation at an Austin food truck, investigators were able to traffic benefits with the truck's owner. During a follow-up interview, the owner admitted to illegally purchasing $163,954 in SNAP benefits from clients over two years. The vendor used the benefits to restock the food truck. This case is pending prosecution at the Travis County District Attorney's Office.

An investigation in Hidalgo County left two stores permanently disqualified from SNAP participation for violating program rules. Federal Food and Nutrition Service investigators determined the retailers were purchasing benefits from SNAP clients for less than face value in exchange for cash. The case was referred to the OIG to investigate the clients who are accused of selling their benefits.

To learn more about the OIG’s efforts to stop SNAP fraud, read the quarterly report on the OIG website.