Restaurants and J.P. Morgan illegally charging and processing sales tax, surcharges and fees to elderly, disabled, poor and home

Several well known restaurants and supermarkets like Kroger, Subway Sandwiches and local San Francisco restaurants and markets have been improperly charging Food Stamp recipients EBT Cards, various processing fees, sales tax or surcharges every time a resident uses their EBT Card Food Benefits to purchase food, beverages and meals.

J.P. Morgan is one of the EBT Card processors who held contracts (in California and other states) obligating them to train participating markets, stores, restaurants and retailers on how to process EBT Card transactions.  They are also responsible for processing EBT Card transactions including remittances to State Sales Tax collectors.

Several local and state EBT Card Program overseers and processors like J. P. Morgan have a published history of failure when it comes to accurate reporting and reconciliation of EBT Card Holder transactions. 

This is not rocket science.  Every time a purchase is made at POS (Point of Sale) Machines the cash register operator or the EBT Card Holder must choose whether to use CASH or Food Benefits after swiping the card in order for the transaction to process.  

Several locations that particpate in the San Francisco 'Restaurant Meals Program' (which allows people that do not have cooking facilities or are unable to cook for themselves, such as the elderly, disabled, poor and homeless residents living in homeless shelters to be able to purchase meals and beverages at participating restaurants and farmer's markets)
 ring up their sales on their own cash register and then manually punch in the food purchase amount into their POS machines. 

Some participants have been adding on sales tax, surcharges (charging higher prices than stated on menus to EBT Card Holders) and card processing fees to the final amount deducted from EBT Card Holder's Food Benefits.  This is a practice which is illegal according to state and federal law and program guidelines and policies.

With monthly, individual EBT Food Benefits averaging around $100 per person and an estimated 4,000 EBT Card Holders in San Francisco, on any given month;  the losses to EBT Card Holders comes to about $7 to $10 each.  

That's about a loss of anywhere from $28,000 to $40,000 each month or around $336,000 to $480,000 each year in San Francisco alone.

State Food Stamp program officials are currently investigating these illegalities which has apparently been a well known problem for many years.  

With apparently inadequate training and lax governmental oversight,  these bad practices has potentially caused millions of dollars worth of Food Benefits to be taken away from hungry residents who depend on these programs to provide them with basic nourishment.

According to the Colorado State Audit from 2005,  J.P. Morgan and Food Stamp regulators were cited in the audit for numerous failures involving the processing, accounting and reconciliation of these EBT Card transactions which caused all kinds of overpayments and underpayments back and forth between J.P. Morgan, banks and state taxing authorities.


What a mess !   To get trained on when you can or cannot charge a tax or fee is like basketball players getting trained to not walk while dribbling or they will get a foul for 'travelling'. 

This is very basic steps to prevent illegal charging of these taxes and fees to EBT Card Holders, yet it appears as though year after year, neither the processing companies like J.P. Morgan nor local, state and federal regulators are able to provide the proper oversight and field testing to prevent these preventable recurring losses to our most vulnerable members of our community,  the elderly, the disabled, the poor and the homeless.

Shame on them all.  The EBT Card Holders in San Francisco are seeking refunds for all such illegally collected taxes and fees from the restaurants, EBT processors and local, state and federal authorities that are responsible for these illegalities.

If you and anyone you know has been charged Sales Tax, Surcharges or Card Processing fees while using their EBT Card Food Benefits to buy food and beverages in any store, market or restaurant, please email details to: 

SFHomeless@yahoo.com

or go online to their SFHomeless Yahoo! Group [ http://groups.yahoo.com/group/sfhomeless/ ] web site, for more information or to share their unfortunate experiences with others in the same situation.

Copyright 2007 - By The SFHomeless Yahoo! Group - San Francisco, CA USA

All Company and Product Names and Marks used in this article are properties of their respective copyright and registered mark owners.