by: Andy Jesson, AOF Policy & Communications Intern
In the mid-1990s, Ohio became the first state in the country to launch a statewide switch to “smart cards” for food assistance recipients, eliminating paper food stamps throughout the state. Nearly 30 years later, paper food stamps are a relic of the past, and individuals receiving food assistance utilize cards similar to that of a debit card issued by a bank. While more convenient, Electronic Benefit Transfer (EBT) cards pose a security threat for hackers intent on stealing and using card information.
What is SNAP Skimming?
SNAP Skimming occurs when thieves place an illegal device on an ATM or card machine at a retailer to copy EBT card information. After the information is stolen, criminals make fake EBT cards and use them to purchase food and beverages. Skimming is an illegal activity not limited to EBT cards, as criminals cost financial institutions and consumers more than $1 billion each year by skimming information off of ATMs, retail locations and fuel pumps across the United States.
SNAP Skimming in Ohio
In Ohio, skimming is becoming an area of increasing concern for families receiving food assistance. Between November 2022 and May 2023, it is estimated that nearly 2,000 transactions were made in Ohio using stolen information, with the amount of funds stolen around $775,000. Beginning in June of this year, an ODJFS plan was implemented for individuals to have their stolen benefits replaced.
Under this new policy, SNAP benefits stolen between October 1, 2022 and September 30, 2024 are eligible for reimbursement, with the exception of Pandemic EBT benefits, which are ineligible. Upon benefits being stolen, the assistance group (AG) must complete the JFS 07011 form including a handwritten signature and submit it to their local county agency. The form needs to be submitted within 90 days of the benefits being stolen or within 90 days of receiving a letter from their county agency notifying them of the theft. Once the completed form is received, county agencies have 30 days to review the request, determine eligibility, and replace benefits if the AG is approved. Replacement benefits cannot be approved or issued until the AG receives a new EBT card, which must be issued by ODJFS within two days of receiving notification of stolen benefits.
The amount of replacement benefits received by the AG is dependent upon the individual circumstances, but cannot exceed the lesser of the amount of benefits stolen or equal to two months of benefits issued to the AG.
Solutions to SNAP Skimming
In the near-term, one key preventative measure SNAP recipients can take is changing their PIN with frequency. Changing your PIN often coupled with avoiding easy-to-guess combinations like birthdays, addresses and social security numbers reduces the likelihood of SNAP skimming. In addition to changing your PIN, Ohio SNAP recipients can now lock their EBT card using an app on their smartphone. It is recommended that cardholders keep the card locked unless actively making a purchase. Instructions for downloading and using the app can be found here. As a long-term action, investment in new technology to distribute chip-enabled EBT cards would further reduce the likelihood of skimming. As of now, no state offers EBT cards equipped with the chip feature, though some states have investment plans for this newer technology.
In addition to a transition to chip-enabled cards, USDA is also exploring a pilot program with five states to test mobile contactless payment. Using the mobile option, SNAP recipients can pay for their groceries using a smartphone in similar fashion to Apple Pay or Google Pay, which connects the user’s smartphone to their bank card information. A potential switch to mobile payment presents another mitigation strategy to current SNAP skimming efforts. The mobile payment pilot program is part of a broader movement towards modernization of SNAP, including programs to allow online shopping using SNAP and WIC benefits.
SNAP skimming is costly for taxpayers and recipients of benefits. Measures taken now to make EBT cards more secure in the future will help reduce the occurrence of stolen benefits and ensure the individuals in need of food assistance are receiving the benefits.