My best friend is on food stamps. She cannot buy alcohol or cigarettes. I already explained how the card does not allow you to do so. I guess that they fixed the problem that your article refers to? So, you are wrong, I do have familiarity with how foodstamps work and how it is obtained. They do varify people's information and they do require updates every year about each case. It is not based on the honor system.
Here are the foodstamp rules, if you want to bother with reality:
http://foodstampguide.org/using-food-stamps/
Heres what you have to prove to get food stamps:
http://foodstampguide.org/required-verifications/