Readers: this is cross-posted from Refugee Resettlement Watch.
Just as Rep. Daryl Issa’s hearing on food stamp fraud was taking place this week, we see more scammers busted in Michigan. Here is the story from the Detroit News:
Detroit— Three Metro Detroit men have been charged with felony counts for a $262,000 food stamp fraud scheme at west side store.
Michigan Attorney General Bill Schuette listed the charges Friday against 37-year-old Dani Mohamed-Kami Itani of Canton Township, Hassan Raychoini, 54, of Dearborn Heights and 22-year-old Raed Youseff of Dearborn for the alleged fraud at Schaefer Dollar Mania in Detroit.
According to the complaint by Schuette, store manager Itani and his employees Raychoini and Youseff, accepted hundreds of thousands of dollars of food stamps for purchases that did not qualify for the Supplemental Nutrition Assistance Program (SNAP) from January 2011 through September 2011. The items included clothing, electronics and watches, according to the criminal complaint. [other reports also mentioned cash–ed]
The men face charges of racketeering, conspiracy and food stamp fraud. They were arrested by Michigan State Police Wednesday and arraigned in 36th District Court in Detroit on Thursday. A preliminary examination has been scheduled for March 20 in 36th District Court.
Using Baron Bodissey’s (Gates of Vienna) scale for measuring “International cultural enrichment” this story has a 33 and 1/3% ‘Mohammed Coefficient’! I’ve joked (sort of) many times about how many of the food stamp fraudsters nabbed come from a certain part of the world.
Hearing in the House Oversight and Government Reform Committee
What Issa was getting at this week was the news (uncovered by Scripps Howard) that, although many stores have been busted, the Dept. of Agriculture has allowed an undetermined number of them to continue to participate in the program.
Here is the Heritage Foundation’s Bluey Reports on the hearing:
Food-stamp fraud and the government’s failed attempts to stop it were the focus of a House Oversight and Government Reform Committee hearing yesterday.
Chairman Darrell Issa (R-CA) called the hearing in response to a Scripps Howard News Service investigative report exposing widespread abuse. The investigation revealed that retailers who lost authorization to accept food stamps were still conducting business despite their restrictions.
“[D]ozens of individuals who had been banned as food-stamp vendors nonetheless remained in the business in New York; Los Angeles; Phoenix; San Diego; Tulsa, Okla.; West Palm Beach, Fla.; Baltimore* and other communities across the country,” according to the report. Scripps Howard discovered this by comparing U.S. Department of Agriculture disqualification records against documents from health-inspection reports to business filings and corporate certificates.
At yesterday’s hearing, Kevin Concannon, undersecretary of the U.S. Department of Agriculture’s Food and Nutrition Service, defended the government’s efforts to combat fraud. He also cast blame on the messenger.
“As with other leads and observations we receive from the public, we took this information very seriously. We began an immediate investigation into all of the stores that were brought to our attention and we have added further layers of security to our retailer oversight process. However, our research indicates that many of the cases identified by Scripps Howard do not involve improper activity,” he said.
Issa, meanwhile, vowed to keep a watchful eye on USDA, demanding additional documents and information.
“With record numbers of Americans using food stamps, with an annual price tag of $75.3 billion, anything short of rigorous anti-fraud measures will be very costly to taxpayers,” Issa said.
“The crime is as widespread as it is simple: Stores accept food stamps, but instead of requiring that customers walk away with wholesome groceries, they provide the customers a small amount of cash — typically 50 cents on the food stamp dollar. While taxpayers lose out — the money isn’t going toward wholesome food — food stamp recipients are receiving no-strings attached cash while stores are taking a hefty profit for serving as a moneychanger,” according to the Scripps Howard report.
* Baltimore too! For my Maryland friends here (via San Diego News):
A Scripps Howard News Service investigation has found records indicating that dozens of individuals who had been banned as food-stamp vendors nonetheless remained in the business in New York; Los Angeles; Phoenix; San Diego; Tulsa, Okla.; West Palm Beach, Fla.; Baltimore and other communities across the country.
Case in point: The Foods Mart convenience store in Baltimore’s gritty Remington neighborhood. In December, Scripps identified one of the store’s owners, using Maryland corporation records and city business filings, as Nasir Pervaiz — who was permanently barred in January 2011 by the USDA.
Upon learning of Scripps’ discovery, the USDA opened an investigation and notified the storeowners that they would face a hearing, agency officials said. As of mid-February, the store was no longer taking food stamps, a visit there showed.
Here, also, is a story about Mohammed Khan and his convenience store being raided in Hagerstown, MD in 2007. I’ve been waiting for nearly five years for the feds (for someone) to pay attention to this problem! Some of the worst cases I’ve reported on were ones where it was discovered that your tax dollars had left the country.
If you are suspicious about a store here is where you can go to report:
The USDA has a hotline — 1-800-424-9121 — and a new website for the public to report alleged fraud: www.fns.usda.gov/fightingsnapfraud.htm