Phony Baloney

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The federally funded Women, Infant and Children (WIC) program provides healthy foods, health care referrals and nutrition education to at-risk low-income pregnant and postpartum women and infants and children up to age five. Eligible beneficiaries receive food vouchers that can be exchanged for nutritious food. (Not unhealthy items or cash.) An article published on WJCL.com details how 32 Savannah WIC program participants used their vouchers to take food from the mouths of their children and put money in their pockets instead.

The story states that over a 17-month period of time, the defendants sold $2.6 million in vouchers at a reduced rate in exchange for cash at a phony grocery store. The fake store would then submit the vouchers to the U.S. Department of Agriculture (USDA) for redemption in the full amount. During this same time period, four other WIC-approved stores in the area only redeemed $1.4 million. (I’m guessing that this raised someone’s suspicions that perhaps the spending was on a bunch of boloney, not bologna.)

A two-year investigation ensued and 32 WIC participants ranging in age from 22 to 49 were convicted of selling more than $100,000 in vouchers. The defendants’ sentences varied and included probation, house arrest and prison. All of them are required to perform community service and repay the full amount of restitution for the WIC vouchers they unlawfully exchanged.

In a related case, 54 employees of the phony grocery store have been recently indicted on charges of opening numerous fake stores across the state of Georgia with the intent to defraud WIC and the Food Stamp Program of more than $19 million. These cases are still pending, and these defendants are innocent until proven guilty.

The good news is 32 criminals have stopped taking resources away from our society’s most needy individuals. And, the authorities are sending a strong message to potential fraudsters – you will be punished for your crimes. The downside…how much restitution do you think the USDA will receive?

Source: Today’s ”Fraud of the Day” is based on an article titled, ”32 Savannahians Sentenced in WIC Fraud Investigation,” written by Christopher Buchanan and published by WJCL.com on August 8, 2014.

SAVANNAH, Ga. (WJCL) – The U.S. Department of Justice announced Friday that over 30 Savannah residents were sentenced this week as part of a massive Georgia Women, Infant, and Children (”WIC”) Program fraud case involving a fake grocery store on Victory Drive.

All 32 participants pleaded guilty and were sentenced this week before United States Magistrate Judge James E. Graham for their roles in selling their WIC vouchers and the vouchers of their minor children for cash.

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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.