Cheesy

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Apparently, the world’s oldest cheese was recently found in an Egyptian tomb by archeologists. It is estimated to be 3,200 years old. (Can you imagine what that must have smelled like?) In addition to having a long storage life, according to a Southeast Portland, Oregon convenience store owner, Egyptian cheese is also very desirable. His claim that patrons bought large amounts of Egyptian cheese did not have as much staying power as the recently found artifact, eventually leading to his conviction for masterminding a food stamp fraud scheme.

The Portland, Oregon convenience store owner carried out a food stamp fraud scheme that involved paying customers 50 cents for each dollar of welfare benefits spent at his store. (He was basically an ATM for customers who didn’t want to use their benefits to purchase items approved by the Supplemental Nutrition Assistance Program, or SNAP.) The store owner would charge say $200 for “phantom food” to a SNAP beneficiary’s EBT card, then give that individual $100 in cash. (That allowed his customers to purchase items like tobacco and alcohol, which were obviously not allowed by the SNAP program. And, the store owner kept the other half – about $100 for himself.)

 It is suspected that news of the minimart’s illegal business practices travelled fast by word of mouth from satisfied customers. Magically, patrons would show up in droves around the first of the month right after the State deposited monthly SNAP benefits onto their EBT cards. (Funny how that happens. Perhaps data on increased sales around the first of the month is what alerted SNAP officials to the potential for fraud.)

Surveillance was set up across the street from the gas station, where the minimart was located, to observe SNAP beneficiary shopping habits. (Lots of patrons were observed leaving without any groceries.) Investigators paired their visual observations with data that revealed unusually high dollar purchase amounts by welfare recipients. The convenience store across the street charged an average of $6.50 per transaction vs. the fraudster’s store, which charged an average of $29 per transaction. (When arrested and questioned, the store owner explained that his customers bought a lot of cheese and pita bread.)

The 39-year-old Portland convenience store owner stole $189,000 in SNAP benefits from low-income Oregonians over 3 ½ years through the food stamp fraud scheme. Even though the store owner pocketed only half of that amount, he is responsible for paying restitution in the full amount. (But, you can’t blame just the storeowner.) In addition to a female relative who worked at the store, the SNAP beneficiaries were also willing participants in the illegal scam.

The store owner was sentenced to 22 months in prison, while his 53-year-old relative, who worked in the store and participated in the scam, got 90 days in jail and five years of probation. She received a reduced sentence after testifying against the store owner. (It looks like this store owner failed to build a better mousetrap by illegally increasing sales at his establishment. In the end, it was he who actually got caught in his own trap – baited with Egyptian cheese.)

Today’s “Fraud of the Day” is based on an article entitled, Minimart owner gave $100 cash for every $200 of food stamps, is headed to prison,” posted on OregonLive.com on February 11, 2018.

A Southeast Portland convenience store owner who paid customers 50 cents for every dollar that they had coming to them in welfare benefits has been sentenced to nearly two years in prison.

Investigators said Nasr Iskander operated his minimart at a Shell gas station on Southeast Powell Boulevard like an ATM by allowing card-carrying recipients in the government’s Supplemental Nutrition Assistance Program to receive cash instead of food.

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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.