SNAP Payment Security and Fraud Prevention Act of 2026

Bill Number

H.R. 7316

Origin Chamber

House

Congress

119th Congress, Session 2

Policy Area

Agriculture and Food

Status

Introduced

Latest Action

2026-03-20: Referred to the Subcommittee on Nutrition and Foreign Agriculture.

Last Updated

2026-07-02T08:07:12Z

AI-Generated Summary

Purpose of the Legislation

The SNAP Payment Security and Fraud Prevention Act of 2026 aims to strengthen cybersecurity for Electronic Benefit Transfer (EBT) cards used in the Supplemental Nutrition Assistance Program (SNAP, formerly known as food stamps). It seeks to prevent fraud and theft of benefits by mandating advanced security technologies, expanding investigative powers, imposing penalties, and ensuring quick access to benefits during issues like card loss or fraud.

Key Provisions

• Expanded Investigative Authority: The Department of Agriculture's Inspector General (IG) gains full power to investigate SNAP benefit theft, including cybercrimes like skimming (stealing card data from ATMs or readers), cloning (duplicating cards), phishing (tricking users into revealing info), and unauthorized EBT system access. This includes issuing subpoenas, coordinating with federal agencies (e.g., FBI, Secret Service), state/local law enforcement, and financial institutions, and accessing data from state vendors. The Secretary of Agriculture can issue rules and allocate funds to support these efforts.

• Civil Penalty for Theft: Anyone who knowingly steals, uses, or transfers SNAP benefits without permission faces a civil penalty of twice the value of the stolen benefits. The Secretary can enforce this through administrative actions or court, with recovered funds used to reimburse affected households and support IG investigations. This penalty adds to any existing criminal or civil consequences.

• Enhanced Cybersecurity for EBT Cards:
• Definitions: Introduces terms like "chip-enabled" (cards using secure, clone-resistant technology, potentially meeting EMVCo standards for contact/contactless payments; EMVCo is an industry group setting global chip standards), "mobile friendly" (accessible on phones per federal guidelines), and "NIST PIN and password standards" (secure guidelines from the National Institute of Standards and Technology to avoid weak security practices).
• Regulations: Within 2 years, the Secretary must issue (and review every 5 years) rules aligning EBT security with private-sector and federal standards for payment cards. Key requirements include:
• States must offer user interfaces (e.g., apps, web portals) for managing EBT accounts, available in required languages, 99% uptime, and including features like transaction history (up to 12 months), fraud reporting, and opt-in alerts.
• Households can opt to restrict online use to virtual card numbers or tokenization (temporary, unique codes for security), freeze manual card entry, and check account status.
• Timeline for chip-enabled cards: Start issuing within 2 years; stop new magnetic stripe cards in 4 years; reissue all existing ones in 5 years (with deactivation of old cards after 30 days or activation of new ones).
• Prohibits states from forcing frequent PIN/password changes against NIST standards.
• Data and Reporting: The Secretary must collect and publish data on system downtime and state cybersecurity measures, plus submit biennial reports to Congress on fraud trends, regulation effectiveness, state efforts, and usability issues (with possible classified annexes).

• No Loss of Access to Benefits: States must provide replacement EBT cards (by mail or in-person, per household choice) within 3 business days for damage, theft, malfunction, or fraud freezes. In-person pickup is optional, not required.

• No Replacement Fees: States cannot charge for replacements due to card malfunction, external fraud, expiration, or required security upgrades.

• Retailer Requirements: SNAP-authorized retailers must install chip-enabled payment terminals at each location within 180 days of final regulations, as a condition for participation.

• Special Report on Puerto Rico: Within 1 year, the Secretary must report on EBT card security there, focusing on cloning resistance and fraud prevention recommendations (with possible classified annex).

• Conforming Amendments: Updates related 2023 law to align with new provisions, removing outdated fraud reimbursement rules.

Significant Changes to Existing Law

• Amends the Food and Nutrition Act of 2008 (7 U.S.C. 2014 et seq.) by adding new subsections for IG authority (Section 16(i)), civil penalties (Section 15(g)), cybersecurity rules (Section 7(h)(15)), replacement timelines and fees (Sections 7(h)(7) and (8)), and retailer terminals (Section 9(a)(5)).
• Phases out magnetic stripe cards entirely (replaced by chip technology), unlike prior laws allowing stripes.
• Introduces mandatory civil penalties and interagency coordination, expanding beyond current criminal-focused enforcement.
• Aligns SNAP with modern payment standards (e.g., EMV chips used in credit/debit cards) and federal cybersecurity guidelines, while adding user protections like fee waivers and quick replacements not explicitly required before.
• Modifies 2023 appropriations law to integrate these changes without conflicting provisions.

Potential Impacts

• Government Agencies: The USDA and its IG will handle more investigations and rulemaking, potentially increasing workload and costs (offset by penalties). States must upgrade systems, train staff, and comply with timelines, possibly straining budgets but reducing long-term fraud losses (SNAP fraud costs millions annually).
• Citizens: SNAP recipients (about 42 million low-income households) gain better fraud protection, easier account management, and uninterrupted benefit access, reducing financial harm from theft. However, transitions (e.g., new cards) may cause short-term disruptions.
• International Relations: No direct impacts; focuses on domestic program security.

Main Stakeholders Affected

• SNAP Recipients: Primary beneficiaries, protected from fraud but may need to adapt to new interfaces or cards.
• State Agencies: Responsible for implementation, including issuing secure cards and user tools; face compliance deadlines and reporting.
• USDA and Inspector General: Gain enforcement tools but must develop regulations and collect data.
• Retailers and Vendors: SNAP stores must upgrade terminals; EBT processors provide data for investigations.
• Law Enforcement and Financial Institutions: Involved in multi-agency coordination to combat cyber fraud.

Notable Legal, Constitutional, or Political Implications

• Legal: Bolsters civil enforcement against fraud, potentially increasing prosecutions and recoveries, but relies on existing administrative and court processes. Mandates like chip transitions could lead to lawsuits if states claim undue burdens, though funds from penalties may mitigate costs.
• Constitutional: Expands federal investigative powers (e.g., subpoenas, data access) under Congress's spending authority for welfare programs, without apparent Fourth Amendment issues (as it targets fraud, not general surveillance). Ensures due process in penalty assessments.
• Political: Addresses rising EBT fraud concerns (e.g., post-pandemic skimming spikes), appealing across parties by protecting taxpayer-funded benefits (SNAP costs ~$120 billion yearly). May spark debates on federal overreach into state programs or tech mandates' costs, but emphasizes equity for vulnerable populations.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Malliotakis, Nicole [R-NY-11]

Recent Actions

• 2026-03-20: Referred to the Subcommittee on Nutrition and Foreign Agriculture.
• 2026-02-02: Referred to the House Committee on Agriculture.
• 2026-02-02: Introduced in House
• 2026-02-02: Introduced in House

Bill Versions

• SNAP Payment Security and Fraud Prevention Act of 2026 — issued 2026-02-02 — PDF (22 pages)