Sec. 672.510 - State Agency Vendor Sanctions
§ 672.510. State Agency Vendor Sanctions
a) State Major Violations
State major violations are violations that, in the determination of the Department, could result in harm to WIC Participants or the WIC Program. The following shall be considered major violations:
1) Failure to maintain the minimum required quantity, size and type of foods of at least three WIC Foods identified in the Minimum Supply of WIC Foods and specified in the WIC Vendor Contract. (See definition of "Minimum Supply of WIC Foods" in Section 672.100.)
2) Any violation of Section 672.450.
3) Accepting any remuneration for the difference between the maximum value of the Food Instrument and the shelf price of the WIC Foods.
4) Having an expired WIC Foods on the shelf. (See Section 672.100 "Expired Food".)
5) Submission of a Federal Employers Identification Number (FEIN) for the business entity operating as a Vendor that differs from the FEIN filed for the same business entity with the USDA Food Stamp Program or with the Illinois Department of Revenue.
6) Submission of false, erroneous or inaccurate information in the business or financial information provided to the Department, on the Retail Vendor Price Survey, or during the course of inspections of the Vendor Site.
7) Refusing to allow the Department access to investigate the Vendor Site during normal business hours.
8) Violation of a term of the WIC Vendor Contract.
9) Use of WIC Authorization by an unauthorized individual, corporation, partnership, limited partnership, unincorporated association, Limited Liability Company or former Vendor (if an individual), or the voluntary or involuntary dissolution of a Vendor corporation, partnership, limited partnership, Limited Liability Company or unincorporated association.
10) Failure to pay the Department the amount of any reimbursement or fine due.
11) Submitting false, erroneous or inaccurate information on the application of a WIC Retail Vendor Contract.
12) Violation of the WIC Vendor Management Act or this Part, or of the federal statutes and regulations regarding the WIC Vendor program.
13) Charging WIC customers (or their proxies or Department Representatives) more for food than non-WIC customers; charging more than the current shelf price, including any sale price or discount; or charging more than what is permitted under the WIC Vendor Contract.
14) Receiving, transacting and/or redeeming Food Instruments outside of authorized channels, including the use of an unauthorized Vendor and/or unauthorized person.
15) Charging for supplemental food not received by the participant.
16) 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.
17) Providing unauthorized food items in exchange for Food Instruments, including charging for supplemental food provided in excess of those listed on the Food Instrument.
18) Purchasing infant formula from a source which is not an approved source as set forth in this Part.
19) Failure to maintain prices for WIC Participants at levels competitive to prices for non-WIC Participants.
b) State Minor Violations:
State minor violations are violations that are administrative in nature and may impose less harm to Participants or the program. The following shall be considered minor violations:
1) Failure to maintain the minimum required quantity, size and type of WIC infant formula as identified in the Minimum Supply of WIC Foods and specified in the WIC Vendor Contract. (See definition of "Minimum Supply of WIC Foods" in Section 672.100.)
2) Requiring a Participant to select a different type or brand of WIC Foods when not specified on the Food Instrument.
3) Altering or submitting for payment altered Food Instruments.
4) The possession, the display on the shelf in the Vendor Site, the attempted sale or actual sale of food products which originated from the WIC Food Centers or the Commodity Supplemental Food Program.
5) Acceptance of WIC Food Instruments that is signed by a Participant, a Proxy or a Department Representative before the total actual cost is filled in by the Vendor.
6) Not posting the shelf price for WIC Foods. If no price is posted, then for the purposes of this Section, the Posted Shelf Price shall be deemed to be the average price for a particular food based on the Retail Vendor Price Surveys performed pursuant to this Part, for stores of like size and location.
c) Sanctions/Administrative Warnings:
1) For each major violation, except those set forth in subsection (c)(2) below, a Vendor shall receive:
A) A fine assessment of $1000 or 10% of the Vendor's monthly average redemptions for the 12 months preceding the advance notification regarding the sanction; and
i) Disqualification from the WIC Program for up to 1 year; or
ii) Probationary status within the WIC Program.
2) For violations set forth in subsections (a)(3), (13), (14), (15), (16) and (17), the Department will give the Vendor an administrative warning. Once a pattern of such violations is established, a sanction shall be imposed pursuant to Section 672.505.
3) For each minor violation a Vendor shall receive:
A) A fine assessment of $500 or 5% of the Vendor's monthly average redemptions for the 12 months preceding the advance notification regarding the sanction; and
B) Probationary status within the WIC Program.
4) Multiple violations in a single investigation shall result in a cumulative fine assessment.
A) The cumulative sanction imposed shall be determined based on the nature and seriousness of the combined violations, the extent of potential harm to WIC clients and the program, and the deterrent effect for the Vendor and other Vendors.
B) 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.
C) The maximum fine and maximum disqualification term shall be no more than the limits set forth in 7 CFR 246.12(l)(2)(i).
5) All fine assessments shall be paid within 30 calendar days from the date of the Secretary's advance notification of administrative action or order, by cashier's check or certified money order in United States currency. If the Vendor fails to pay any fine assessed within 30 calendar days after the date of the Secretary's advance notification or order, the Department shall disqualify the Vendor from participation in the WIC Program until the fine is paid, and an additional fee of $1500 shall be required to reinstate Vendor Authorization.
d) A Vendor remaining in the program after a finding of violations shall provide certification that the situation giving rise to the violations has been corrected, with documentation regarding the correction as requested by the Department.
e) If the Department has reasonable grounds for believing that a Participating Vendor has committed an abuse or violation of the WIC Program, the Department may send written notice to the Vendor citing the specific grounds and warning the Vendor that abuse or violations should not continue or recur. The Department, however, is not required to provide a vendor with administrative warning prior to imposing sanctions or repudiating a vendor agreement.(
Amended by peremptory rulemaking at 30 Ill. Reg. 14602, effective September 1, 2006)
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