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TheStreet Open House

Food Stamp Card Failure Incites Shopper Frenzy at Walmart Stores

By Hal M. Bundrick

NEW YORK (MainStreet) ¿ A flash mob of shoppers raided stores impacted by a technical glitch in the federal food stamp program this past weekend, but taxpayers will not have to foot the bill.

Shelves were cleared at two Louisiana Walmart stores Saturday as a system failure for electronic benefit transfer (EBT) cards incited a shopping frenzy. EBT cards are much like debit cards, allowing purchases tied to benefits issued through the federal food stamps program, which offers low-income families assistance in purchasing groceries.

Xerox implements the federal card program and reported a service outage Saturday, October 12, that prevented the reporting of benefit limits on EBT cards in 17 states. Shoppers in most affected states were turned away, but two Wal-Mart stores in Louisiana allowed unlimited purchases during the outage.

Due to overwhelming crowds, police were ultimately called in to assist store employees. When the technical issue was resolved at 9 p.m. and a store announcement was made saying the cards were back online, shoppers abandoned their packed shopping carts and left. No arrests were reported.

Springhill, La. police chief Will Lynd told Shreveport television station KSLA that when the EBT system was restored, one woman was detained, because she had attempted to purchase $700 of groceries with only a 49 cent credit on her card. She was held by police until Walmart authorities said they wouldn't press charges if she left the food.

According to a notice posted on The Louisiana Department of Children and Family Services website, all transactions are recorded.

"While transactional systems maintained by DCFS contractors may have been impacted by today's outage, the systems that DCFS uses to track EBT card usage and identify fraud were still in place," the notice says. "DCFS vigorously investigates all fraud claims. Anyone suspected of fraudulently using public assistance benefits are investigated and prosecuted to the full extent of the law."

Trey Williams, a spokesman for DCFS, told the Baton Rouge Advocate that taxpayers would not be responsible for any false benefits claimed.

"No funds from our standpoint were utilized," Williams said. "The safeguards the state had in place worked. Any recoupment would be from a retailer standpoint."

Kayla Whaling, a spokesperson for Walmart, told KSLA that the company was "fully engaged and monitoring the situation and transactions during the outage."

"We did make the decision to continue to accept EBT cards - and purchases on WIC and SNAP - during the outage so that they could get food for their families," Whaling said.

--Written by Hal M. Bundrick for MainStreet

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