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CED-78-183 1 (1978-12-28)

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                                        S-             .Io-J'o

 REPORT BY THE


 Comptroller General


 OF THE UNTED STATES





 Regulation Of Retailers Authorized

 To Accept Food Stamps Should Be

 Strengthened




 The Department of Agriculture's Food and
 Nutrition Service has unnecessarily authorized
 some retailers to accept food stamps even
 though they sold only token amounts of
 staple foods. This weakens the primary con-
 trol for channeling food stamp use to staple
 foods needed for an economical nutritious
 diet and seems inconsistent with the legis-
 lation requiring that only retailers advancing
 program objectives be authorized. Agriculture
 believes that the Food Stamp Act of 1977
 will result in improvements in this regard.

 Food  stamp  redemption controls need
 strengthening. Data the Service uses for rou-
 tinely monitoring 270,000 retailers is unre-
 liable, and independent controls to make sure
 that commercial banks are accepting food
 stamps only as permitted do not exist.

 The Department has been unable to ade-
 quately identify, and impose timely and effec-
 tive penalties against, retailers not adhering to
 the law and program regulations.


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             OU,                                                       CE D-78-183
   IO'd1co v                     2987                            DECEMBER 28,1978

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