While states like Massachusetts, Ohio, and South Carolina are moving ahead with chip-enabled EBT cards to protect their recipients from electronic theft, New York is still using magnetic stripe cards — and is now facing the consequences in court. The organization Legal Services NYC filed a federal lawsuit in June 2025 in the U.S. District Court for the Southern District of New York against the New York State Office of Temporary and Disability Assistance (OTDA), accusing it of leaving nearly 3 million SNAP recipients exposed to skimming fraud by refusing to modernize its EBT cards.
The lawsuit, filed on behalf of seven affected individuals and one advocacy organization, demands that the court order the state to immediately transition to secure chip-enabled EBT cards and compensate victims whose benefits were stolen with no possibility of reimbursement. The case shines a light on a paradox affecting millions of New Yorkers: the state has the technology available to protect them — and has refused to use it.
A problem of alarming scale in New York
The numbers are striking. Between 2023 and 2024, New York recorded approximately 85,000 cases of EBT card skimming, totaling nearly $40 million in stolen benefits. That represents almost 20 percent of the national total of SNAP benefit theft through skimming across the entire country — a disproportionately high share for a single state.
Skimming involves installing cloning devices on payment terminals to copy data stored on a card’s magnetic stripe. Once stolen, that data is used to drain the victim’s balance — typically within hours, and often in another state or online — making recovery of the funds extremely difficult. With a chip card, this type of attack is virtually impossible because the chip generates a unique, one-time code for every transaction.
The lawsuit emphasizes that the urgency to act is even greater since December 20, 2024, when Congress failed to renew the federal authorization that had allowed states to reimburse recipients for stolen benefits. Since then, anyone who suffers skimming in New York loses their benefits with no way to get them back. The state can no longer replace the money — and it has also taken no steps to prevent the theft.
Why New York has not acted
The lawsuit argues that New York has been in breach of its legal obligation for years to adopt technologies that protect the timely and accurate delivery of SNAP benefits. Federal law requires states to implement available technological measures to protect the program against fraud and abuse — and the EMV chip is precisely that available and proven technology that other states are already deploying.
The situation is particularly striking because the USDA authorized chip and contactless EBT cards in 2024 and published implementation guidance in August 2025. Since then, several states have moved quickly. New York, with the highest absolute number of skimming cases in the country, has taken no steps in that direction.
«The solution is simple and cost effective — New York State must follow suit by putting chips on all our EBT cards.»
— Legal Services NYC, in the lawsuit announcement
What could change if the lawsuit succeeds
If the court rules in favor of the plaintiffs, New York would be required to urgently begin transitioning to chip-enabled EBT cards for its nearly 3 million SNAP recipients, making it the state with the largest number of modernized cards in the country. It could also be required to establish a compensation mechanism for skimming victims who lost benefits with no possibility of recovery since December 2024.
For SNAP recipients in New York, the message is clear: take extra precautions with your EBT card. Check your balance frequently — daily if possible — use payment terminals at trusted stores, and contact the number on the back of your card immediately if you notice any transaction you did not make yourself.