Food stamps are intended for food. When individuals sell their benefits for cash it violates the spirit and intent of the Food Stamp Program as well as the law. This practice, known as trafficking, diverts food stamp benefits away from their purpose. It reduces intended nutritional assistance and undermines public perceptions of the integrity and utility of the program. To combat trafficking, the Food and Nutrition Service conducts undercover investigations of authorized food stores. In addition, the agency has developed powerful new EBT-based administrative tools to identify and sanction traffickers.

FNS published “The WIC Vendor Management Study, 1998” in July 2001 which examined, in part, the extent to which retail grocers, defined as WIC “vendors” were violating program rules and regulations. The 1998 study is a follow-up to the “WIC Vendor Issues Study, 1991” published by FNS in May 1993. 

The purpose of the study was to learn the extent to which retail grocers, defined as "vendors" in the WIC Program, authorized to provide food to WIC participants, were violating program rules and procedures, and to determine which programmatic and/or demographic variables could be associated with vendor violations.

The NSLP offers free and reduced-price school meals to students from eligible households. Households with incomes at or below 130 percent of poverty are eligible for free meals, and households with incomes between 131 percent and 185 percent of poverty are eligible for reduced-price meals. Traditionally, to receive these benefits, households had to complete and submit application forms to schools or be directly certified. Direct certification, on the other hand, is a method of eligibility determination that does not require families to complete school meal applications. Instead, school officials use documentation from the local or state welfare agency that indicates that a household participates in AFDC or food stamps as the basis for certifying students for free school meals.

This report duplicates the precise methodology of the earlier analysis with more than 10,000 new investigations to generate an estimate for the 1996 - 1998 calendar year period.

Prior to 1982, school districts were not required to verify the income or household size declared by households that applied for meal benefits. It was assumed that households were correctly reporting their income, and children from households that applied and declared a sufficiently Low income were given free or reduced-price meals. From 1982 to the present, the verification of household income for at least some of the approved application s for meal benefits has been part of each school district's responsibilities.