Ohio Administrative Code|Rule 3701-42-08 | Abuse of the WIC program; sanctions.

                                                
(A) The director shall sanction vendors
		  that abuse the WIC program. The vendor violations referenced in paragraphs (B)
		  to (E) of this rule constitute abuse of the WIC program. The director may
		  sanction a vendor for any violation of this chapter of the Administrative Code
		  that does not constitute abuse. The director will provide the vendor with a
		  notice that violations are occurring that may lead to mandatory sanctions under
		  paragraph (C)(4) or (D) of this rule prior to taking action, unless providing
		  such notice compromises an investigation.
(B) The director shall terminate a
		  contract and disqualify a vendor for a period of six years if the director
		  finds that the vendor has exchanged WIC nutrition cards or the benefits
		  contained on the card for cash, firearms, ammunition, explosives, or controlled
		  substances as defined in 21 U.S.C. 802 (in effect on January 3,
		  2012).
(C) The director shall terminate a
		  contract and disqualify a vendor for a period of three years if the director
		  finds that the vendor has:
(1) Exchanged WIC
			 nutrition cards or the benefits contained on the card for alcohol or alcoholic
			 beverages or tobacco products; 
(2) Transacted WIC
			 nutrition card benefits for a specific authorized food, which exceeds the
			 vendor's documented inventory of that authorized food for a specific
			 period of time;
(3) Failed to respond and
			 provide the requested original documents for verification of authorized food
			 purchases and sales as set forth in paragraph (H) of rule 3701-42-06 of the
			 Administrative Code; or
(4)  Engaged in a pattern of any of the
			 following:
(a) Exchanging WIC nutrition cards or the benefits contained on
				the card for credit, including rain checks, or non-food items;
(b) Redeeming WIC nutrition card benefits for authorized foods
				not received by the participants;
(c) Redeeming WIC nutrition card benefits for which the reported
				amount of sale is more than the marked or posted prices charged to other
				customers regardless of the not to exceed amount for the item(s)
				purchased;
(d) Seeking reimbursement from the department for WIC nutrition
				card benefits submitted through an authorized vendor while not authorized as a
				vendor under rule 3701-42-03 of the Administrative Code.
(D) The director shall terminate a
		  contract and disqualify a vendor for a period of one year if the director finds
		  that the vendor has engaged in a pattern of providing unauthorized food items
		  in exchange for benefits on the WIC nutrition card, including charging for
		  authorized foods provided in excess of those on the WIC nutrition
		  card.
(E) The director shall terminate a
		  contract and disqualify from the WIC program a vendor who has been disqualified
		  from the food assistance program. The disqualification from the WIC program
		  shall be for the same length of time as the disqualification from the food
		  assistance program. The disqualification from the WIC program may begin at a
		  later date than the food assistance program disqualification and shall take
		  effect on the date the vendor receives notice of WIC disqualification.
		  Termination and disqualification from the WIC program under this paragraph is
		  not subject to an administrative or abbreviated review as set forth in rule
		  3701-42-09 of the Administrative Code.
(F) The director shall terminate a
		  contract of a vendor who has been suspended, disqualified, withdrawn or
		  otherwise no longer authorized by the food assistance program. Contract
		  termination pursuant to this paragraph is not subject to an administrative or
		  abbreviated review as set forth in rule 3701-42-09 of the Administrative
		  Code.
(G) Prior to terminating a contract and imposing disqualification
		  of a vendor pursuant to paragraphs (B) to (D) of this rule, the director shall
		  consider whether the disqualification of the vendor would result in inadequate
		  participant access. If the director determines that the disqualification would
		  result in inadequate participant access, the director shall assess a civil
		  money penalty in lieu of the disqualification. The amount of the civil money
		  penalty shall be determined in accordance with paragraph (O) of this
		  rule.
(H) The director shall double the civil money penalty for a
		  second sanction when a vendor, that has been previously disqualified or
		  assessed a civil money penalty pursuant to paragraphs (B) to (D) of this rule,
		  receives another sanction pursuant to paragraphs (B) to (D) of this rule. A
		  civil money penalty may only be doubled up to the limits allowed under
		  paragraph (O) of this rule.
(I) The director shall double the civil money penalty for the
		  third and subsequent sanctions when a vendor that has been previously assessed
		  two or more sanctions pursuant to paragraphs (B) to (D) of this rule and
		  receives another sanction pursuant to paragraphs (B) to (D) of this rule. The
		  director shall not assess a civil money penalty in lieu of disqualification for
		  third and subsequent sanctions pursuant to paragraphs (B) to (D) of this
		  rule.
(J) Notwithstanding paragraph (B) of this rule, the director
		  shall terminate a vendor contract and permanently disqualify from the WIC
		  program a vendor that has been convicted in a court of law for trafficking in
		  WIC nutrition cards or benefits on the cards or selling firearms, ammunition,
		  explosives, or controlled substances as defined in 21 U.S.C. 802 (in effect on
		  January 3, 2012), in exchange for WIC nutrition cards or benefits on the
		  cards.
(K) The director may terminate a contract and disqualify from the
		  WIC program a vendor whose WIC sales exceed fifty per cent of its gross food
		  sales.
(L)  The director may sanction a vendor that has committed one or
		  more vendor violations of this chapter that do not constitute abuse by doing
		  either of the following:
(1) Terminating a vendor
			 contract and disqualifying the vendor from the WIC program for a period of not
			 more than one year for one or more violations resulting from a single
			 investigation; or
(2) Assessing a civil
			 money penalty in accordance with amount set forth in the current effective
			 version of 7 CFR 3.91(b)(3) (as in effect on the effective date of this
			 rule).
(M) The director may terminate a contract and disqualify from the
		  WIC program a vendor that has been assessed a civil money penalty in the food
		  assistance program, as provided under 7 C.F.R. 278.6 (in effect on January 1,
		  2012). The length of such disqualification shall correspond to the period for
		  which the vendor would otherwise have been disqualified from the food
		  assistance program. If the director determines that disqualification of the
		  vendor would result in inadequate participant access, the director shall not
		  disqualify the vendor nor impose a civil money penalty in lieu of
		  disqualification.
(N) The director may choose to impose a
		  civil money penalty in lieu of termination and disqualification from the WIC
		  program if the director determines that it is in the best interest of the WIC
		  program.
(O) The director shall use the following formula to calculate a
		  civil money penalty imposed in lieu of disqualification pursuant to paragraph
		  (G) or (N) of this rule:
(1) Determine the
			 vendor's average monthly redemptions for at least the six month period
			 ending with the month immediately preceding the month during which the notice
			 of administrative action is dated;
(2) Multiply the average
			 monthly redemptions figure by ten per cent; 
(3) Multiply the product
			 from paragraph (O)(2) of this rule by the number of months for which the
			 location would have been disqualified; and 
(4)  Civil money
			 penalty amounts will not exceed the penalty amounts as set forth in the current
			 version of 7 CFR 3.91(b)(3) (as in effect on the effective date of this
			 rule).
(P) In determining the period of disqualification to impose or
		  amount of civil money penalty to assess a vendor pursuant to paragraph (O) of
		  this rule, the director shall consider at least the following
		  factors:
(1) The vendor's
			 compliance history;
(2) The severity or
			 nature of the violation;
(3) The potential
			 monetary loss to the state WIC program; and
(4) The vendor's
			 volume of WIC business.
(Q) If a vendor does not pay, only partially pays, or fails to
		  timely pay a civil money penalty assessed in lieu of disqualification, the
		  director shall terminate the contract and disqualify the vendor for the length
		  of the disqualification corresponding to the violation for which the civil
		  money penalty was assessed. The director may withhold any current or future
		  payments due to the vendor to offset any payment owed by the vendor to the
		  department.
(R) The director shall refer a vendor that is disqualified from
		  participating in the WIC program or assessed a civil money penalty in lieu of
		  disqualification from the WIC program to FNS for possible disqualification from
		  participation in the food assistance program. The director shall refer a vendor
		  that abuses the WIC program to federal, state, or local authorities for
		  criminal prosecution under applicable statutes, where appropriate.
(S) The director shall not accept a vendor's voluntary
		  withdrawal or non-renewal of the contract as an alternative to disqualification
		  when the director is required or has started the process to disqualify the
		  vendor pursuant to this rule. Even if the vendor attempts to voluntarily
		  withdraw or does not renew the contract in lieu of disqualification the
		  director shall enter the disqualification on the record.
(T) Except for permanent disqualification pursuant to paragraph
		  (J) of this rule, a vendor that has been disqualified from the WIC program may
		  apply for a new vendor contract in accordance with rule 3701-42-03 of the
		  Administrative Code after the period of disqualification has
		  expired.
(U) A vendor who commits fraud or engages
		  in other illegal activity is subject to prosecution under applicable federal,
		  state, or local laws.