Stealing from Babies

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Mother with son shopping in a delicatessen store, being helped by smiling cashier.

It’s hard to imagine how people can steal food from the mouths of disadvantaged babies and their mothers, but it happens.

The U.S. Department of Agriculture’s Special Supplemental Nutrition Assistance Program, or SNAP, for Women, Infants and Children, also known as WIC, is a $6.3 billion program designed to supply nutrition to pregnant women, mothers and children younger than five who are at risk for malnutrition. When people defraud the program, they keep government-subsidized nutrition out of the mouths of babies – literally.

Today’s SNAP fraud case happened recently in Atlanta where three people were convicted in December of multiple counts each of fraud and conspiracy surrounding the distribution of WIC vouchers. The three defendants – a brother, sister, and sister-in-law – own and operate an Atlanta pharmacy where they were found to have bought the food vouchers from recipients, and then sought reimbursement from the government at a higher dollar amount, without actually providing food to the recipients. (Where is the compassion?)

The pharmacy was an authorized vendor of the program since 2005 and received training on WIC rules, including the prohibition on buying vouchers. Yet, from at least 2009 to 2013, the three bought WIC vouchers from low-income mothers for a fraction of their face value without providing food or infant formula.

After purchasing the vouchers, the defendants deposited them into their bank accounts and sought reimbursement from the government. The fraud amounts to tens of thousands of WIC vouchers that resulted in $6.5 million in reimbursements, which far surpassed the WIC redemptions from much larger, nearby stores. Despite the massive amount of WIC redemptions, Poly-Plex Pharmacy had less than $1.3 million in actual expenses for food and infant formula during the same time frame. (So, these fraudsters banked over $5 million in profits, which they are likely to have to repay.)

The jury convicted the defendants of wire fraud conspiracy and 12 counts each of wire fraud, theft of government funds, and WIC fraud. The three, who range in age from 52 to 57, have not been sentenced.

Today’s Fraud of the Day comes from a U.S. Department of Justice press release, “Atlanta pharmacy operators convicted of more than $4 million fraud,” released Dec. 12, 2019.

Three defendants who own and operate an Atlanta pharmacy have been convicted by a jury of a multi-million dollar fraud scheme that targeted the U.S. Department of Agriculture’s Special Supplemental Nutrition Program for Women, Infants, and Children (“WIC”) program.   Each defendant was convicted of conspiracy and multiple fraud counts for buying WIC vouchers from low-income recipients and then fraudulently seeking reimbursement from the federal government at a higher dollar amount as if they had actually provided nutritious food to those recipients.

“The defendants bought vouchers from low-income recipients and sought refunds from the federal government at a significant profit instead of providing the nutritious foods to infants and children listed on the vouchers,” said U.S. Attorney Byung J. “BJay” Pak. “The defendants’ scheme lined their pockets at the expense of federal taxpayers and the low-income women and children who stood to benefit from the program.”

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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.