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Investigators Nab Convenience Store Owner for Over Half Million in Food Stamp Fraud

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Mimosa Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-11 11:12 AM
Original message
Investigators Nab Convenience Store Owner for Over Half Million in Food Stamp Fraud
Edited on Wed Nov-23-11 11:30 AM by Mimosa
Several times a couple of years ago Prez Obama said the Federal government was going to investigate fraud in various programs. His statements were made in the context of saving money for various programs by eliminating waste and fraud.

I don't know about where you live but here in GA there have been quite a few reports of people defrauding various Federal programs getting caught.

http://www.ajc.com/news/m...owner-faces-1237832.html

Excerpt:

Prosecutors said Shamsha Mirza Vasaya would also give patrons 50 cents on the dollar for their food stamps, in addition to allowing them to buy items not allowed, such as gasoline.


>snip<


Georgia had 1,851,586 people on food stamps in August, or 19 percent of its population, according to the USDA. Nationwide, nearly 15 percent used food stamps during the period.

Last month, store owner Elbert Eugene Shinholster of Wilkinson County pleaded guilty to defrauding the food stamp program of more than $4.68 million over five years. Authorities called it the largest food stamp fraud in the states history in money lost to taxpayers.

Over the past three years there have been 597 convictions nationwide and $197.4 million in fines, restitution and forfeiture orders, according to the USDA.

Vasaya will be sentenced Jan. 24, and in addition to a maximum 20-year sentence she faces a fine of up to $250,000

The U.S. Department of Agriculture, which administers the food stamp program, says $330 million in taxpayer funds are diverted annually from the $64.7 billion program through similar unscrupulous means.

The transactions are electronically recorded, and investigators have stepped up monitoring thousands of convenience and mom-and-pop stores to curb the illegal sales, according to an Associated Press report.

Between June 2009 and July of this year, prosecutors say Vasayas Chevron Food Mart at 811 South Marietta Parkway made about $557,421 from the scheme.



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montanacowboy Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-11 11:23 AM
Response to Original message
1. I used to be an investigator for USDA
investigated food stamp fraud

that is called "trafficking" and you would be surprised how many vendors
engage in this; mostly in low income neighborhoods they thrive
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coalition_unwilling Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-11 11:33 AM
Response to Reply #1
3. Question about the content: the story says the store owner would
give customers 50 cents on the dollar for their food stamps. Was the store owner then using those food stamps to buy him- or herself food at 100 cents on the dollar?

In other words, were the food stamps functioning as a sort of de facto alternative currency?

Story raised as many questions as it answered, imo.
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arbusto_baboso Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-11 11:37 AM
Response to Reply #3
4. I can answer some of those questions, as I work on cash aid/food stamps cases.
In some low income neighborhoods, food stamps (which are on "EBT" cards; think a bank debot card devoted to state benefits) are sold for cash.

Usually, this is done by those with drug issues, in order to acquire cash for drugs, alcohol and/or tobacco products.

And yes, the store owner was likely using the EBT cards later himself, or even reselling them at, say, 75 cents on the dollar.
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Mimosa Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-11 11:45 AM
Response to Reply #4
6. Thank you for the info, Arbusto!
In the first instance the convenience store owner is a woman. And she is facing some serious jail time. That should make anybody considering profiting from doing what she did think twice. ;)

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arbusto_baboso Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-11 11:48 AM
Response to Reply #6
7. Oops, should've read that article more closely.
Didn't realize I switched genders on the store owner.

Fraud still happens.

There are many, many more safeguards now than just a few years ago, but fraud still happens. And most it is just as stupid as in this case. The only thing preventing more arrest for this sort of stuff is that welfare fruad investigators are quite swamped, and the burden of proof is high. That, and most muncipalities won't prosecute unless the fraud exceeds a certain amount.
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dkf Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-11 11:29 AM
Response to Original message
2. Well that is stupid if the transactions are all recorded.
D
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montanacowboy Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-11 12:01 PM
Response to Reply #2
8. The transactions are recorded electronically
but unless transactions are investigated it will go unnoticed as it goes through as a regular transaction for food

investigation is prompted by unusual activity at a certain store and all the transactions at that location are then analyzed for many different factors. In addition a CI will go into a suspect location and try to get the vendor to traffic with him, this will then trigger a very detailed analyzed investigation of the various transactions in that store. Watching people come out of the store with no grocery bags in their hands after having just completed an electronic transaction is another investigative tool.
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Mimosa Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Nov-23-11 11:43 AM
Response to Original message
5. This is an example of the President doing what he said he'd do
There have been numerous reports in the news about people defrauding various federal programs getting caught and prosecuted.

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