How has USDA updated SNAP anti-trafficking rules over time?

1. How a 1993 law reshaped penalties and set a tougher tone

The Omnibus Budget Reconciliation Act of 1993 substantially altered civil‑money‑penalty (CMP) treatment for trafficking in SNAP benefit redemption instruments, shifting the prior two‑year aggregate cap so that the $40,000 limitation applied to each individual investigation rather than to a rolling two‑year window, while keeping the $20,000 per‑violation limit unchanged. This change increased the potential financial exposure for firms under investigation in a single probe and tightened enforcement leverage against retailers and other businesses involved in trafficking, creating a stronger statutory backbone for later regulatory actions and enforcement efforts ^[1]. The legislative adjustment built on earlier statutes from 1988 and 1990 and signaled a sustained congressional focus on making penalties more consequential to deter trafficking behavior ^[1].

2. Regulatory refinements: defining trafficking and curbing online and public sales

USDA regulatory updates refined the definition of “trafficking” to remove outdated language and to explicitly cover modern modalities such as attempting to buy or sell SNAP benefits online and in public transactions; the department issued an updated trafficking definition in February 2013 and provided clarifying guidance in August 2013, with changes effective November 21, 2013. These rule changes broadened enforcement reach by clarifying what constitutes trafficking conduct and aligning regulations with contemporary marketplaces, enabling investigations and sanctions for both offline retailer schemes and newer online resale or barter practices ^{[2] [5]}. The clarified definition supported subsequent guidance on retailer and client responsibilities and helped states in framing investigatory and prosecutorial approaches ^[2].

3. Operational controls: replacement cards, notices, and state responsibilities

Regulatory revisions imposed operational controls on states to help detect and deter trafficking, including a requirement that states send written notices to clients after four replacement card requests within a 12‑month rolling period and to withhold replacement cards after a fifth request while investigating suspected fraud. These provisions give states discretion to operationalize safeguards but require clear communications to beneficiaries and consistency with the amended trafficking definition; the rules mandate that notices be in plain language and specify that the 12‑month count does not reset upon issuing a notice ^[6]. By targeting patterns consistent with trafficking—such as excessive replacement requests—the rule aims to catch diversion schemes involving frequent card turnover and resale of benefits ^[6].

4. Technology and enforcement: EBT tracking, ALERT, and investigative capacity

USDA has invested in technology and investigative resources to strengthen detection and prosecution of trafficking, leveraging Electronic Benefits Transfer (EBT) transaction data to spot suspicious behavior and enhancing the ALERT (Anti‑Fraud Locator using EBT Retailer Transactions) system. The agency established dedicated analyst and investigator teams, collaborated with state law‑enforcement partners, and developed a SNAP Fraud Framework to provide evidence‑based tools for states. These actions correlated with a long‑term reduction in estimated trafficking rates—from roughly four cents on the dollar in 1993 to about one cent during 2006–08—reflecting measurable declines tied to better data, retailer monitoring, and prosecutions ^{[3] [4]}. USDA also prioritized outreach to retailers to clarify rules and reduce inadvertent violations ^[4].

5. Controversies, data demands, and competing priorities

USDA efforts to tighten controls and demand more recipient and state data have prompted legal and political friction, with some states resisting broad data requests and courts or commentators raising concerns about privacy and program access. Critics frame aggressive data demands and public characterizations of program corruption as risks to beneficiary protections and program integrity goals, while USDA and proponents emphasize that stronger data and enforcement are necessary to prevent diversion and fraud. This tension reveals an ongoing tradeoff between pursuing fraud reduction through data‑driven enforcement and safeguarding beneficiary confidentiality and access, an issue that has shaped USDA’s approach and generated litigation and public debate ^[7].