News

No-limit food stamp cards cause Walmart shoppers to go wild

No-limit food stamp cards cause Walmart shoppers to go wild

NO LIMIT: The walmart company logo is seen outside a walmart Stores Inc company distribution center in Bentonville, Arkansas June 6, 2013. Photo: Reuters/ REUTERS/Rick Wilking

By Kathy Finn

NEW ORLEANS (Reuters) – Walmart Stores Inc and Xerox Corp blamed each other on Monday after Louisiana food stamp recipients stripped bare the shelves of some walmart stores when a computer glitch left their debit cards with no limits.

Managers of walmart 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 walmarts 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 walmart’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 walmart to follow in response to EBT outages.”

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

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 walmart 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 walmart 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 walmart 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 walmart continued.

Recent Headlines

in Entertainment

This weekend in entertainment history

Fresh
nirvana

A look back at some of Hollywood's most memorable moments.

in Sports

James leads Cavaliers past Bulls, 114-108 in OT

Cleveland Cavaliers' LeBron James poses at the NBA basketball team's media day Friday, Sept. 26, 2014, in Independence, Ohio.

James was at his best after struggling the previous night

in Sports

Cubs hire Maddon as manager, fire Renteria

Tampa Bay Rays manager Joe Maddon looks on during a baseball game against the Minnesota Twins, Saturday, Sept. 14, 2013, in Minneapolis.

Joe Maddon has been hired as manager of the Cubs after the team fired Rick Renteria.

in Sports

Kentucky earns No. 1 nod in AP preseason poll

Kentucky men's coach John Calipari

Kentucky is No. 1 in The Associated Press preseason Top 25 for the second straight season.

in Sports

Michigan athletic director Dave Brandon resigns

University of Michigan President Mark Schlissel announces that athletic director Dave Brandon resigned during a news conference in Ann Arbor, Mich., Friday, Oct. 31, 2014. Former Steelcase CEO Jim Hackett will serve as Michigan's interim athletic director.

Michigan athletic director Dave Brandon resigned Friday, setting the stage for new leadership at the top of one of the nation's most prominent athletic departments.

Bellingham Traffic