Food for Thought

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39381071 - classroom with yellow chairs and tables in the kindergarten

Through the U.S. Department of Agriculture, the Child and Adult Care Food Program (CACFP) provides nutritious food to young children, older adults and chronically impaired disabled persons in institutions such as day care centers and group homes. (This is definitely food for thought – approximately 3.3 million children and 120,000 adults receive meals and snacks each day through this program.) An article published by the Courier-Post describes the current charges against the owner of a Philadelphia day care center chain accused of bilking the CACFP of approximately $1.3 million through bogus claims. (You could definitely buy a lot of snacks with that amount of money.)

The article states that the owner allegedly submitted false claims to the CACFP program for reimbursement, while her four daycare centers reportedly often lacked an adequate amount of food. Over a two-and-a-half year period, the day care operator purportedly submitted $523,000 in claims for meals that did not meet nutritional requirements and were not served. Prosecutors also allege she directed other employees to submit their own personal grocery receipts so they could be used as false evidence.

It gets more interesting. In addition, federal prosecutors say the daycare operator fabricated evidence in a defamation lawsuit against a local radio station disc jockey, who claimed the owner was linked to a street fight in Philadelphia. After the 44-year-old owner claimed the on air personality defamed her, day care center revenues supposedly fell by a substantial amount, causing one location to close.

Federal prosecutors claim that the woman manufactured evidence to include death threat recordings, day care center vandalism photographs and fake financial records that supposedly proved significant financial loss following the disc jockey’s derogatory comments. (The article explains that the DJ was fired and the station owner ended up settling the lawsuit for a significant sum.) Federal prosecutors also claim that the DJ’s comments did not cause any harm to the woman’s day care center chain and suggest that the owner directed people to write letters from fictitious families stating that they were going to remove their children from the center. Prosecutors purport that the owner inflated fees to make her losses appear even greater.

Two others are suspected of being involved in these two scams. In addition to the day care owner, a former aide is charged in both schemes while an employee of the Pennsylvania education department is facing charges related to the CACFP scam. It is critical to remember that all these defendants are innocent until proven guilty, and they deserve their day in court.

The good news is…this case proves the government is committed to prosecuting suspected abuse of programs meant for deserving beneficiaries, especially children. Let’s hope any potential day care fraudsters give this case sufficient food for thought before they act.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”S.J. Woman Accused of Using Day Cares for Fraud,” written by Jim Walsh and published by the Courier-Post on July 16, 2014.

Authorities say a Sicklerville woman netted about $1.3 million through separate schemes based at her chain of day care centers in Philadelphia.

Tracey Parson, 44, submitted bogus claims to a government program that funded meals for low-income children at Kiddie Kare Child Care & Education Centers, federal prosecutors said Monday.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.