Regulation .13 Claims and Penalties.

If the State agency determines through a review of a local agency's reports, program or financial analysis, monitoring, audit, or other means, that Program funds provided to a local agency for administrative and program services purposes were, through the local agency's negligence or fraud, misused or otherwise diverted from Program purposes, the State agency shall make a claim against the local agency.

The local agency shall pay the State agency a sum equal to the amount of misused or diverted administrative and program services funds and the face value of food misused or diverted instruments, or both.