This bill significantly strengthens the security and fraud prevention measures for Electronic Benefit Transfer (EBT) cards used in the Supplemental Nutrition Assistance Program (SNAP). It grants the Department of Agriculture Inspector General expanded authority to investigate and coordinate efforts against benefit theft, specifically targeting cyber-enabled fraud like skimming and cloning. This authority includes issuing subpoenas, making criminal referrals, and collaborating with various law enforcement agencies and financial institutions.

The legislation establishes a civil penalty for unauthorized access, use, or transfer of SNAP benefits, requiring offenders to pay twice the value of the stolen benefits. Funds recovered from these penalties will be used to reimburse households for lost benefits and support the Inspector General's enhanced investigatory activities. A key provision mandates the Secretary of Agriculture to promulgate and regularly update comprehensive cybersecurity and digital service regulations for EBT cards and mobile payments within two years, ensuring they align with private sector and federal agency security standards.

These new regulations will require States to offer various user interfaces for beneficiaries to manage their EBT accounts, including web portals and mobile applications, which must be mobile-friendly and available in multiple languages. States must also provide timely electronic transaction notices, access to historical transactions, and the ability to report fraudulent activity. Furthermore, the bill mandates the issuance of chip-enabled EBT cards within two years of the regulations becoming final, with a prohibition on new magnetic stripe cards after four years and a requirement to reissue all existing magnetic stripe cards as chip-enabled within five years.

To further protect beneficiaries, the bill prohibits State agencies from charging replacement fees for EBT cards that are malfunctioning, stolen due to fraud, expired, or require replacement under the new regulations. It also ensures that replacement cards for damaged, lost, stolen, or frozen EBT cards are provided within three business days, with options for mail or in-person delivery. Finally, the bill requires retail food stores and wholesale concerns to adopt chip-enabled payment terminals as a condition for SNAP participation, enhancing security across the entire payment ecosystem.