Food Stamp Millionaire

24914276 - man putting money in suit jacket pocket concept for corruption, bribing, paying or business wealth

There are some words you don’t usually see together – food stamp and millionaire. After all, the benefits issued through the U.S. Department of Agriculture’s Supplemental Nutrition Assistance Program (SNAP) are assigned for people at the poverty level. (Not to someone who could afford a small yacht.) An Ohio man who had assets worth tens of millions of dollars committed $8,300 in SNAP fraud by not disclosing his personal wealth. (And while he was at it, he also lied on his Medicaid application, committing Medicaid fraud.)

To paint a picture of today’s fraudster, it’s important to look at the whole picture. The man who claims he was the son of an Iranian prince and comes from a successful, wealthy family also boasted that he once had lunch with Donald Trump. (That’s not something that usually happens to someone receiving food stamps.) He also owned a home worth $800,000 and enjoyed a swimming pool, multiple vehicles, stabled horses and an underdeveloped property worth tens of millions of dollars in St. Lucia. (Taking care of all those possessions could definitely make you poor.)

Now, let’s take a look at what supposedly happened to the defendant. When his business failed, he claimed on his welfare application form that he had no other alternative but to seek public assistance so he could feed his suburban family. However, prosecutors and county investigators discovered that while the defendant and his family were receiving food stamps over the course of two years, more than $1 million was flowing through various bank accounts owned by him. (That does not sound like impoverishment to me.) While this information did not bode well for the defendant, the judge declared that the state’s case against the man was impeded by the lack of a forensic examination of the man’s assets and decided these discovered records did not provide an accurate accounting of his wealth.

From the defense attorney’s point of view, prosecutors created an illusion of great wealth when describing his client, although he says the man was destitute. The defendant’s lawyer argued that his client did not break any laws by obtaining food stamps. (The failure of his business, coupled with a foreclosed home and a heavily mortgaged St. Lucia property, his client had nowhere else to turn except to food stamps to feed his family.)

As to the large amount of money flowing through his bank accounts? Apparently, the defendant’s friends loaned him $500,000 to help him out of the rough spot. (Those are some pretty nice friends.) The defense attorney explained that the loans and the St. Lucia property were not required to be reported as income or disclosed on a welfare application.

The 66-year-old man was convicted on two charges related to the illegally collected $8,300 in food stamps, plus other welfare benefits over two years. He faces a maximum sentence of 18 months in prison, although Ohio law tends to go easy on first offenders by ordering probation. He may also have to make restitution for the welfare benefits he received. (Let’s hope so.)

Today’s article states that it is highly unlikely that the defendant will go to state prison for committing SNAP fraud, but will most likely get a brief jail sentence or house arrest. (One certainty is that he will be ineligible for food stamps in the future.) Apparently, the judge stated the fraudster paid his household expenses with funds from his businesses. (That tends to show he was not a pauper after all.) This fraudster was old enough to know better. SNAP is set up to help the poor, not the wealthy. (Once sentenced for his illegal actions, I’m guessing this “Food Stamp Millionaire” will have a much better understanding of the requirements for qualifying for the SNAP program.)

Today’s “Fraud of the Day” is based on an article entitled, Judge finds Geauga County ‘food stamp millionaire’ guilty of welfare fraudposted on on September 16, 2017.

CHARDON – Prosecutors say they will seek jail time for a wealthy Geauga County man convicted of fraudulently obtaining food stamps and Medicaid for his suburban family.

Pascal Mahvi, the so-called “Food Stamp Millionaire,” was convicted Friday of two fraud-related charges stemming from his acceptance of more than $8,300 in food stamps and other welfare benefits during a two-year span that ended with his arrest last year.

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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.