State won't pay Xerox for food stamp glitch

Oct 17, 2013

LANSING, MI (AP)--   Michigan will withhold money from Xerox Corporation because a technical problem crashed the state's debit card-style food stamps program during the weekend. 

State Department of Human Services spokesman Dave Akerly says Michigan is within its rights to withhold 15 percent of the October bill due to "vendor non-compliance."  He says Xerox is required to maintain 99.9 percent access to food assistance and failed to do so.

The specific amount that won't be paid is unclear because Michigan hasn't gotten the monthly invoice yet.  But if the tab is similar to the September bill, Xerox could lose out on $80,000.

The problem began Saturday and Xerox fixed it late in the day.

The issue began after a routine test of backup systems by Xerox resulted in a system failure.