Balancing Act

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Balancing acts are one of the primary reasons people of all ages enjoy going to the circus. (Who doesn’t like the excitement of watching a performer walk across a tightly strung wire rope while carrying someone on his shoulders and juggling under the big top tent?) One wrong move and the acrobat’s mistake could have devastating consequences. An article published in the Yakima Herald describes how one man’s balancing act hid food stamp fraud. Unfortunately, he made two mistakes during his fraudulent acts that revealed his crime.

The story reports that a manager of a market allowed his cashiers to dispense money to Electronic Benefit Transfer (EBT) cards beneficiaries. The card holder would receive half the value of the card’s benefit balance, while the store’s bank account was credited with the full amount.

The storeowner was aware of the fraudulent transactions, but neglected to notify the authorities. (That’s because he was ”cooking the books.” His accounting methods cleverly hid the illegally received food stamp benefits.) Supposedly, he received more than $400,000 in food stamp benefits.

His ruse was revealed when undercover informants were sent to the store with EBT cards. During two separate visits, the agents were able to obtain cash in exchange for the card benefits.

The store owner pleaded guilty. He was sentenced to two years in prison, one year of probation and will have to pay back $300,000 in restitution. The two employees involved in the fraud also pleaded guilty; one to welfare fraud and the other to wire fraud.

This man and his employees didn’t do a very good job of walking the fine line between legal and illegal behavior. (Lucky for them, it looks like the justice system is going to be their safety net.) Perhaps the store manager will have some time in jail to learn how to walk the straight and narrow ethical line while experiencing the consequences of his unsuccessful balancing act.

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Yakima Store Manager Sentenced for Food-Stamp Fraud,” written by Donald W. Meyers and published by the Yakima Herald on September 24, 2014.

The manager of a Mexican market was ordered Tuesday to pay back $300,000 in funds federal prosecutors say his employees collected in a food stamp fraud scheme involving Electronic Benefit Transfer (EBT) cards.

Manpreet Singh, who managed La Bodega/Yakimex, 511 N. First St., also was sentenced to two years in prison and a year probation for his role in the scheme.

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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.