Fingers point after Wal-Mart food stamp debacle

Hundreds of shoppers took advantage of a glitch allowing unlimited purchases. So who's going to pick up the tab now?

By MSN Money Partner Oct 15, 2013 11:55AM
Wal-Mart store in Secaucus, New Jersey / Jin Lee/Bloomberg via Getty ImagesBy Kathy Finn, Reuters

Wal-Mart Stores (WMT) and Xerox Corp. (XRX) blamed each other on Monday after Louisiana food stamp recipients stripped bare the shelves of some Wal-Mart stores when a computer glitch left their debit cards with no limits.

Managers of Wal-Mart stores in the small, north Louisiana towns of Springhill and Mansfield alerted police on Saturday night that throngs of shoppers had flooded into the stores and were buying groceries using electronic benefit cards that contained no credit limits.

EBT cards are debit-type cards issued under the state's food stamp program and coded to show the amount of money available for individuals to spend. Food stamps are a federal government subsidy program for low-income people that is administered by the states.


When word got out Saturday that the EBT cards were showing no limits, card holders rushed to area Wal-Marts to take advantage.


"Some people had eight or 10 shopping carts full of groceries," Springhill Police Chief Will Lynd said on Monday.


Xerox said on Saturday that its systems that process EBT transactions suffered an outage stemming from routine testing of backup generators that malfunctioned. Louisiana was one of 17 states affected by the outage.


Kayla Whiting, a spokeswoman at Wal-Mart's Bentonville, Arkansas, headquarters, pointed to Xerox as the source of the problem and referred further questions to Xerox.


Xerox corporate spokesman Bill McKee provided a written company statement saying that Xerox has a "documented process for retailers like Wal-Mart to follow in response to EBT outages."


But the statement left unclear who would cover the unauthorized spending, and it referred further questions to Wal-Mart.


Louisiana officials said they had no intention of being left holding the bag. "The outage was the result of failures by our contractor, Xerox," said Trey Williams, a spokesman for the Louisiana Department of Children and Family Services.


He said emergency procedures in place with Xerox allow retailers to call a phone number and receive authorization for purchases any time the EBT system is down. "Some retailers chose not to follow the process," he said. "Those businesses are only being reimbursed for the (maximum) amounts on individual cards," he said.


Williams said that amounts transacted above the cards' available balances were returned to Wal-Mart marked "as insufficient funds."


He could not provide an estimate of the total amount of overspending or say who will cover it in the end. "That's a conversation between Xerox and the retailer," he said.


Carts full of groceries

Springhill's Lynd arrived at his town's Wal-Mart store at about 7 p.m. local time and found a few hundred shoppers jamming checkout lines with carts filled to overflowing.


Lynd said he told the manager that the store had a right to refuse service, but the manager said she had contacted Wal-Mart headquarters and was told to accept the cards.


The shoppers "decimated the grocery section of Walmart," Lynd said.


The shoppers broke no laws, Lynd said, adding that police intervention was not required to disperse the crowd. At about 9 p.m., Walmart said that the glitch had been fixed and the EBT cards were again showing appropriate spending limits.


"When they heard the announcement, people just left their carts in place and walked out of the store," Lynd said.


Mansfield Assistant Police Chief Gary Hobbs reported a similar scene in his community. He said that several other grocery stores in the area temporarily stopped accepting EBT cards when they became aware of the glitch, but Wal-Mart continued.


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51Comments
Oct 15, 2013 12:30PM
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What's wrong with this picture ?  Shaquanda has 8 carts full of groceries and an EBT card. Is it possible that something is not right here ? 

 

Here's the correct solution to the problem. Walmart eats the cost of the food they let her have and Shaquanda's *ss goes to jail for felony theft.

 

Here's what will actually happen. Walmart will pass the loss along to it's customers and Shaquanda will  make some serious bank selling the extra food. I'm sure some will also be traded for rock.

 

That concludes today's lesson on justice in America.

Oct 15, 2013 12:28PM
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While the shoppers broke no laws, they still shouldn't get the groceries completely free.  To my way of thinking, they've simply gotten their allocation of money in advance.  Hopefully the system recorded how much money was posted to their account, and it will continue to be negative over the next few weeks until their normal future allocations catch up with what they've used. 
Oct 15, 2013 12:51PM
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Yes this same type of Action against a Bank ATM or bank card, is quite serious..

 

And these people "knew they were pulling something off", that's called "intent".

Oct 15, 2013 12:46PM
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Nancy.... YES, THEY DID, commit a CRIME it's called FRAUD, Maybe Larceny by conversion.

 

It is against the State or Federal Government, depending on the Funding...

It could be considered a Federal crime against the State, Government or Taxpayer...

 

I hope they go to Jail or lose all EBT/SNAP privileges forever.....

And like someone said Wally World "eat" the cost or be prosecuted also. 

Oct 15, 2013 1:33PM
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Simple, if they over bought on their food stamps this month then limit their purchases in future months until their balance goes positive.
Oct 15, 2013 1:08PM
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its called stealing according to everything my mother taught me
Oct 15, 2013 1:55PM
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IT ISN'T WALMART'S FAULT OR XEROX FAULT, ITS THE DIS-HONEST, I AM ENTITLED A HAND-OUT FROM THE GOVERNMENT, NON-INTERESTED IN GETTING A JOB, MILKING SOCIETY TYPES, THAT VOTED IN OUR PRESIDENT, THAT ARE SENDING THIS COUNTRY SPIRALING DOWNWARD.  GET OFF YOUR DUFF, GET A JOB, AND DO SOMETHING WITH YOURSELF!
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If I spend too much from my bank account, who is to blame?  It's time that those who are truly responsible step up and take responsibility for their actions.
Oct 15, 2013 1:22PM
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The only thing this story left out was what color a majority of the "shoppers" were, and how many were driving Escalades with 22's on them, who called on their friends on their Obama phone to alert them of the situation.  

Oct 15, 2013 1:51PM
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IF THE "HONEST WORKING PERSON' WOULD SPEND MORE THAN ALLOTTED ON LET'S SAY A DEBIT CARD, YOU WOULD BE RESPONSIBLE TO PAY THAT AMOUNT BACK PLUS PENALTIES.  THERE FORE THE SAME SHOULD APPLY.
Oct 15, 2013 2:05PM
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These people living on food stamps KNOW exactly how much they get to spend each month, come on now, one women with .47 cents on her card has over $700 worth of merchandise in her cart. Clear intent to steal!!!! How do they even find out so quick? If you know you got $5 on your card your not going to fill up your cart right? Obviously must have got instant messages right to their phones...halarious how they on food stamps but can afford nice phones. Then again clear intent to steal. Easy solution make all their food stamp cards have a negative balance until everything is paid back. THEY should be paying for this. Lesson learned get a freaking job if you now run out of food 
Oct 15, 2013 1:26PM
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The democrats won't make the losers take any responsibility. They don't like to alienate their voting base.
Oct 15, 2013 2:22PM
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My how far we have fallen. When I was a kid, it was a source of shame to accept handouts; white, black, pink, purple, it made no difference. Our preacher and his wife were young and dirt poor, yet they so adamantly refused handouts that church members used to call them over while other church members snuck food into their house.

 

Then, in 1968, welfare came into being. Now it seems everyone is "entitled". Someone please answer this for me: The average working family, according to our own census.gov, spends around $500 a month for food for a family of 4. Why is it that EBT recipients currently receive $688 and some politicians are upset that that is being cut to $632/month? Why are they "entitled" to 30% more than the working family spends?

 

I think we may be beyond the "tipping point" now.

Oct 15, 2013 1:53PM
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See all the low life scum stealing from us? These are the scum the democrats are defending. These are the scum that they want to borrow more money to feed.
Oct 15, 2013 1:49PM
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THIS SHOULD BE CONSIDERED FRAUD AGAINST THE GOVERNMENT, AND THEREFORE A FELONY. 
Oct 15, 2013 1:18PM
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Food stamps are always a license to steal.
Oct 15, 2013 12:31PM
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Both caused the problem, Xerox testing caused EBT cards to go down, and the few Wal-Mart stores that allowed the EBT cards to be used, when all other Wal-Mart stores did not.
Oct 15, 2013 2:38PM
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     Has anyone heard of the "R" word? Responsibility. Those people knew that they were "Stealing" and should be held responsibile for the debt. Take it fromthe future allocations of their cards.

      If one knowingly steals and is not subsequently held responsibile, where is this sad country headed?

Oct 15, 2013 3:06PM
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I WOULD BET A FAIR AMOUNT THAT THE AVERAGE AMERICAN DOES NOT PUT TWO AND TWO TOGETHER AND REALIZE THAT IT IS THE "HONEST WORKING PEOPLE"  THAT ARE PAYING FOR THESE EBT CARDS!  I BELIEVE THIS COUNTRY IS ON THE VERGE OF ANOTHER REVOLUTION.  MR. OBAMA CAN KEEP PUSHING, BUT THE HONEST WORKING AMERICAN WILL SOON TAKE NO MORE....  WE NEED TO PUT AN END TO THE IDEAL THAT THE GOVERNMENT OWNS US.  MANY GREAT PEOPLE HAVE GIVCEN THEIR LIVES TO BE ABLE TO LIVE FREE.  MR OBAMA AND HIS FOLLOWERS ARE TRYING TO CHANGE ALL THAT.  GIVE UP YOUR GUNS AND YOUR ABILITY TO FIGHT, AND YOU BECOME NOTHING MORE THAN A PAWN IN UGLY GAME.
Oct 15, 2013 2:04PM
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Apparently, the Wal-Mart smiley face was smiling ear-to-ear that day.  The Louisiana food stamp recipients were, "Saving Money & Living Better" as the Wal-Mart slogan says.

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