TITLE 77: PUBLIC HEALTH
CHAPTER X: DEPARTMENT OF HUMAN SERVICES
SUBCHAPTER i: MATERNAL AND CHILD HEALTH
PART 672 WIC VENDOR MANAGEMENT CODE
SECTION 672.505 FEDERALLY MANDATED VENDOR SANCTIONS


 

Section 672.505  Federally Mandated Vendor Sanctions

 

Vendors shall receive the following sanctions for the following violations as mandated by 7 CFR 246.12:

 

a)         Permanent disqualification:

 

1)         The Department shall permanently disqualify a Vendor convicted of:

 

A)        trafficking in food instruments; or

 

B)        selling firearms, ammunition, explosives, or controlled substances (as defined in section 802 of the Controlled Substances Act (21 USC 802), in exchange for Food Instruments.

 

2)         A vendor shall not be entitled to receive any compensation for revenues lost as a result of such violation.

 

3)         The Department shall impose a civil money penalty in lieu of a disqualification for a violation when it determines, in its sole discretion, and documents that:

 

A)        Disqualification of the Vendor would result in inadequate Participant Access; or

 

B)        The Vendor had, at the time of the violation, a policy and program in effect to prevent trafficking; and the ownership of the Vendor was not aware of, did not approve of, and was not involved in the conduct of the violation.

 

b)         Six year disqualification:

The Department shall disqualify a Vendor for six years for:

 

1)         one incident of buying or selling Food Instruments for cash (trafficking); or

 

2)         one incident of selling firearms, ammunition, explosives or controlled substances as defined in 21 USC 802, in exchange for Food Instruments.

 

c)         Three year disqualification:

The Department shall disqualify a Vendor for three years for:

 

1)         One incident of the sale of alcohol or alcoholic beverages or tobacco products in exchange for Food Instruments;

 

2)         A pattern of claiming reimbursement for the sale of an amount of specific supplemental food item that exceeds the store's documented inventory of that supplemental food item for a specified period of time;

 

3)         A pattern of charging WIC Participants (or their proxies or Department Representatives) more for supplemental food than non-WIC customers and/or charging Participants more than the current shelf price, including any posted sale price or discount, and/or charging Participants more than what is permitted under the WIC Vendor Contract;

 

4)         A pattern of receiving, transacting and/or redeeming Food Instruments outside of authorized channels, including the use of an unauthorized Vendor and/or unauthorized person;

 

5)         A pattern of charging for supplemental food not received by the Participant; or

 

6)         A pattern of providing credit or non-food items, other than alcohol, alcoholic beverages, tobacco products, cash, firearms, ammunition, explosives, or controlled substances as defined in 21 USC 802, in exchange for Food Instruments.

 

For the purpose of this Section, a "pattern" shall be activity that is repeated a significant number of times.

 

For the purpose of determining a "pattern" of overcharging violations as set forth in Section 672.505(c)(3) and Section 672.505(c)(5), three or more instances of the activity described in Section 672.505(c)(3) and Section 672.505(c)(5) alone, or in combination with each other, within a period of eighteen months, shall be significant and constitute a pattern.

 

With regard to Section 672.505(c)(3), overcharges of 40 cents or more, or overcharges which constitute 7% or more of the total amount of sale of WIC Foods to the overcharged participant on that date, shall be considered significant for the purpose of determining a pattern.  Charging for an item(s) not received, as set forth in Section 672.505(c)(5), shall be significant for the purpose of determining a pattern, regardless what amount is charged for the food item(s) not received.

 

d)         One year disqualification:

The Department shall disqualify a Vendor for one year for a pattern of providing unauthorized food items in exchange for Food Instruments, including charging for supplemental food provided in excess of those listed on the Food Instrument.

 

e)         Second sanction:

When a Vendor, who previously has been assessed a sanction for any of the violations in subsections (b) through (d) of this Section, receives another sanction for any of these violations, the Department shall double the second sanction.

 

f)         Third or subsequent sanction:

When a Vendor, who previously has been assessed two or more sanctions for violations in subsections (b) through (d) of this Section, receives another sanction for such violations, the Department shall double the third sanction and all subsequent sanctions for such violations.

 

g)         Disqualification based on a Food Stamp Program disqualification:

The Department shall disqualify a Vendor who has been disqualified from the Food Stamp Program.  The disqualification shall be for the same length of time as the Food Stamp Program disqualification, may begin at a later date than the Food Stamp Program disqualification, and shall not be subject to administrative or judicial review under the WIC program.

 

h)         Voluntary withdrawal or non-renewal agreement:

The Department shall not accept voluntary withdrawal of the Vendor from the Program as an alternative to disqualification for the above-listed violations of this Section, but shall enter the disqualification on the record. In addition, the Department shall not use non-renewal of the Vendor agreement as an alternative to disqualification.

 

i)          Participant Access determinations:

 

1)         Prior to disqualifying a Vendor for a violation of subsections (b) through (d) or (g), the Department shall determine if disqualification of the Vendor would result in inadequate Participant Access.

 

2)         When making Participant Access determinations, the Department shall consider, at a minimum, the availability of other authorized Vendors within the same area as the violative Vendor and any geographical barriers to using such Vendors.

 

j)          Civil money penalty:

 

1)         The Department may impose a civil money penalty in lieu of disqualification for violations in subsections (b) through (d) or (g) if the Department, in its sole discretion and documentation determines that disqualification of the Vendor would result in inadequate Participant Access.

 

2)         If a civil money penalty is imposed in lieu of disqualification it shall be calculated for each violation subject to sanction under this Section, using the formula set forth in 7 CFR 246.12(k)(l)(x).

 

3)         If a Vendor does not pay, or only partially pays, the penalty, the Department shall disqualify the Vendor for the length of the disqualification corresponding to the violation for which the civil money penalty was assessed (for a period corresponding to the most serious violation in cases where the federally mandated sanction includes the imposition of multiple civil money penalties as a result of a single investigation).

 

4)         Civil money penalties may be doubled for second sanctions under this Section up to the limits set forth in 7 CFR 246.12(k)(l)(x).  Civil money penalties may not be imposed in lieu of disqualification for third or subsequent violations under this Section.

 

k)         Notification to Federal Food and Nutrition Service:

The Department shall provide the appropriate FNS office with a copy of the notice of administrative action, and information on Vendors it has disqualified or on whom it has imposed a civil money penalty in lieu of disqualification for any of the violations of this Section, within 15 days after the Vendor's opportunity to file for a WIC administrative review has expired or all the Vendor's WIC administrative reviews have been completed.

 

l)          Multiple violations during a single investigation:

 

1)         When during the course of a single investigation the Department determines a Vendor has committed multiple violations (which may include violations subject to State agency sanctions), the Department shall disqualify the Vendor for the period corresponding to the most serious federally mandated violation.  However, the Department shall include all violations in the notice of administrative action. 

 

2)         An investigation shall be considered complete when, in the judgement of the Department, sufficient evidence exists to determine whether the Vendor is complying with program requirements.

 

(Source:  Amended by peremptory rulemaking at 30 Ill. Reg. 14602, effective September 1, 2006)