Grocer Goes for the Green

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Many small business owners who operate retail stores struggle to compete with large national chains. However, few try to get a leg up on their competition by committing fraud. The Herald nonetheless reports that a Washington state business owner did just that by paying food stamp recipients cash for items they purchased at grocery stores, and then reselling those items at his store, in a scheme that brought in hundreds of thousands of dollars.

According to the story, prosecutors alleged that the shop owner paid cents on the dollar to food stamp recipients, in exchange for the value of their benefits cards. (Too bad for him that buying $132 worth of soda with food stamps is the sort of move that raises suspicions.) The 36-year-old immigrant was also accused of purchasing what he believed to be stolen cigarettes and energy drinks at a fraction of their fair market values, in order to resell them in his store. Finally, grocery store theft investigators revealed that the greedy merchant engaged shoplifters to steal from his competition and sell the merchandise to him. (No wonder the city declared his business a chronic nuisance.)

After pleading guilty to multiple counts of trafficking in food stamp benefits, attempted trafficking in stolen property and possession of an illegal synthetic drug, the first-time offender was sentenced to 16 months in prison and had to forfeit $410,000 in illegal profit stashed in multiple bank accounts. (Let’s hope his time in prison will give him the chance to re-stock his values.)

Source: Today’s ”Fraud of the Day” is based on an article titled, ”Everett food stamp trafficker forfeits $410,000, keeps house,” written by Diana Hefley and published by The Herald on December 6, 2015.

EVERETT — A downtown store owner accused of running a food stamp fraud ring has been sent to prison and was forced to forfeit more than $410,000.

Fraz ”Tony” Mushtaq will get to keep his Everett home in an agreement reached with federal prosecutors, according to court documents. He forfeited all money seized from multiple bank accounts. Prosecutors alleged it was the profit of a criminal enterprise.

The forfeiture settlement came after Mushtaq, 36, pleaded guilty in Snohomish County Superior Court to multiple counts of trafficking in food stamp benefits and attempted trafficking in stolen property. He also admitted to possessing illegal ”spice,” a synthetic drug.

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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.