A Spike in Fraud

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According to the U.S. Department of Agriculture’s Food and Nutrition Service, the trafficking rate for the Supplemental Nutrition Assistance Program (SNAP) has dropped dramatically over the past twenty years due to technology which is used to track and control abuse of the former food stamp program. One way this is accomplished is through the monitoring of electronic benefits transfer (EBT) retailer transactions, which can identify suspicious activity for further investigation. Irregular activity was identified in a Massachusetts convenience store and now the owner is paying in a big way for stealing $3.6 million in food stamp benefits.

An article posted on masslive.com states that the owner of the convenience store enabled customers to sell their SNAP benefits to her for 50 cents on the dollar. Investigators found more than 22,000 questionable food stamp transactions over a period of four years. (Apparently technology detected that her particular store’s SNAP transaction rate was 2,000 percent higher than what she submitted in her application to provide the service.) Consequently, her store was closed down.

The fraudster pleaded guilty to conspiracy to commit SNAP benefits fraud, SNAP fraud and money laundering. Even though her legal counsel argued to keep her out of prison, she was sentenced to one year and a day in the federal pen to be followed by three years of supervised release. She is required to forfeit $3.5 million and ordered to pay restitution although the amount has not been determined yet.

The article stated that this particular fraud case was the largest in the history of Massachusetts. Thanks to new technology, government investigators are better equipped to hunt down and put an end to this type of deception. (After this woman’s store was shut down, a spike in area food stamp transactions was detected and another store is now under investigation for food stamp fraud and counterfeit goods transactions.)

While defending his client in court, the store owner’s lawyer asked, ”What good comes from putting her in jail?” The answer is pretty simple. This type of punishment sends a strong message to others who may be contemplating similar illegal acts—this type of criminal behavior will not be tolerated.

Source: Today’s ”Fraud of the Day” is based on an article entitled, ”Vida Causey gets 1 year in prison for stealing $3.6 million in SNAP benefits in largest food stamp fraud in Massachusetts history,” posted on masslive.com July 11, 2016.

WORCESTER — The Worcester woman who stole $3.6 million in food stamp benefits while running a Worcester convenience store was sentenced to serve one year and a day in federal prison Monday.

A federal prosecutor said the fraud was the largest in the history of the state.

Vida Ofori Causey, the 46-year-old woman who owned the Main Street convenience store called J&W Aseda Plaza, pleaded guilty to one count of each of conspiracy to commit SNAP benefits fraud, SNAP fraud and money laundering in U.S. District Court in December.

Causey will be placed on supervised release for three years once she is released from prison. Causey will forfeit $3.5 million. She was also ordered to pay restitution, but the amount has not been determined yet.

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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.