Florida is at the center of a massive food stamp fraud bust with 22 people charged from allegedly collecting over $13 million from the United States Department of Agriculture by fraudulently trading food stamps for cash.
U.S. Attorney for the Southern District of Florida Wifredo Ferrer, joined by Florida Attorney General Pam Bondi and Chief Financial Officer Jeff Atwater, among others, announced the charges Wednesday.
According to a press release, 22 retail store owners or operators participated in a scheme to illegally redeem food stamp benefits in exchange for cash. The majority of the fraud took place in the Opa Locka Hialeah Flea Market.
The retailers, says the indictment, did not provide any food for the stamps, a fraud scheme commonly referred to as “food stamp trafficking.”
Vendors like the Opa Locka Fruit and Produce Market applied for and obtained authorization to participate in SNAP.
The stores, once authorized to participate in the Supplemental Nutrition Assistance Program (SNAP) would allegedly swipe the recipient’s Electronic Benefits Transfer (EBT) card at a point of service (POS) machine for an inflated amount and would pay the recipient a reduced percentage of the value of the food stamp benefits charged on the cards.
In most cases, the recipients never received food or any eligible items for their food stamp benefits.
The defendants would pay the recipients cash, but pocketed the extra profit from each transaction. When all was said and done, the indictment alleged the total charges for the food stamp fraud totaled over $13 million.
The case originated with a report of identity theft in Palm Beach County. Around 500 people had their identities stolen in Palm Beach County to create fake EBT cards to be redeemed at flea market retailers.
“Instead of operating within the confines of the rules and regulations for farmers' market vendors, these retailers created an illegal benefits exchange system that defrauded the American taxpayer and denied healthy foods to needy children and their families.,” said Karen Citizen-Wilcox, Special Agent in Charge at the USDA-OIG.
Wifredo Ferrer said the U.S. Attorney’s Office planned to prosecute the individuals responsible for the fraud since those participating in food stamp trafficking had defrauded the people who need the benefits the most.
“When individuals defraud governmental programs, they steal taxpayer funded benefits that are intended to feed the families and children in our communities who are most in need,” Ferrer said.
Florida officials chimed in on the charges, vowing to protect Florida citizens from food stamp fraud.
“Food stamp trafficking is a serious crime tantamount to stealing from the hardworking taxpayers in our state,” said Attorney General Bondi.
“To steal from public programs designed to help our neighbors in their greatest time of need is to steal from every taxpayer in Florida, and I’m glad to see that those who participate in the fraudulent schemes will be brought to justice,” said Chief Financial Officer Jeff Atwater. “This partnered investigation displays our shared commitment to aggressively fighting fraud in Florida, and our collective work continues.”
If convicted of the charges, defendants face a maximum sentence of 20 years in prison for conspiracy to commit wire fraud, 20 years in prison for wire fraud and five years in prison for food stamp/EBT fraud.
Reach reporter Allison Nielsen by email at allison@sunshinestatenews.com or follow her on Twitter: @AllisonNielsen.
