Summary: According to the most recent Food and Nutrition Service study available, about $815 million, or four percent of the food stamps issued, was trafficked at retail stores during fiscal year 1993. Supermarkets and large grocery stores redeemed 82.5 percent of all food stamp benefits and had a combined trafficking rate of 1.9 percent of all benefits redeemed. In contrast, smaller grocery stores redeemed 17.5 percent of the benefits but had a combined trafficking rate of 13 percent of the benefits redeemed. During fiscal years 1990 through 1997, the Food and Nutrition Service identified food stamp trafficking in more than 5,700 retail stores, the Office of Inspector General investigated and reported on 5,551 trafficking cases, and the Justice Department and state and local cases prosecuted about 2,650 cases referred by the Office of Inspector General. In the 432 food stamp trafficking cases GAO reviewed, store owners alone were caught trafficking in about 40 percent of the cases, clerks alone were involved in 47 percent of the cases, and store owners and clerks together were caught trafficking in 13 percent of the cases. The Food and Nutrition Service disqualified the owners caught trafficking from the Food Stamp Program in 428 cases and assessed penalties totaling $1.1 million. The courts assessed $1.4 million in penalties and sentenced owners to jail in 16 cases. Store clerks--caught trafficking in 260 cases--received about $36,500 in penalties and jail sentences in nine cases. GAO summarized this report in testimony before Congress; see: Food Assistance: Observations on Reducing Fraud and Abuse in the Food Stamp Program, by Robert A. Robinson, Director of Food and Agriculture Issues, before the Senate Committee on Agriculture, Nutrition, and Forestry. GAO/T-RCED-98-167, Apr. 23 (13 pages).
