After fraudulently reporting low income and virtually no assets, Ahmed Sheikh Mohamed requested and received government welfare handouts for food, housing, heating, medical treatment and even college costs for his family.
Mlive (H/T Rod F) -GRAND RAPIDS, MI – He didn’t disclose that his small Grand Rapids grocery store deposited $800,000 from 2006 to 2009. Or, that he made $60,000 annually in food-stamp fraud. Or, that he routinely moved cash in a business account to an account for personal spending, which included a $15,000 family vacation in Mecca, the government said.
“The principal goal of the conspiracy was to obtain money by defrauding federal programs intended to provide food, housing, medical care and underprivileged,” Assistant U.S. Attorney Nils Kessler wrote recently in a court document.
The investigation, which led to charges against Mohamed and two others, was one of at least five in the last year in the Grand Rapids area targeting stores that trade electronic food stamps for cash and ineligible items. Enforcement action last year in Michigan convinced the U.S. Department of Agriculture, which oversees the benefit program, to provide a $3.3 million grant to fight fraud and abuse in the food-assistance program.
With many families struggling in Michigan, U.S. Sen. Debbie Stabenow said Thursday: “It really is an outrage when people are cheating and defrauding a system” that is intended to help the poor.
With the advent of electronic benefits, investigators can determine if stores are redeeming an inordinate amount of food stamps, factoring in the size of the store and its location and, during inspections, food on the shelves. In some cases, investigators said, stores offered little in the way of nutritional food.
The numbers of those requesting assistance nationwide has hit a high of 44 million in recent months. Last fiscal year, $64 billion in food stamps were redeemed, compared to $15 billion in 2000. The USDA reported fraud accounts for one percent of spending, which is down significantly from years ago.
The $3.3 million grant will not only be used to stop fraud and abuse, but help prosecute offenders and recoup losses. In the last six months, 80 people have been convicted in the country, and ordered to repay $80 million, she said.
In the latest Grand Rapids case, the government alleged that Mohamed, his son, Mohamed Isse, and his nephew, Abdulrahman Hassan Mohamed, owned or operated Rayan Phone Cards and Grocery, a small store that catered to the Somali immigrant community, and conspired to defraud the government’s food-stamp program.
The defendants have all pleaded not guilty.
Kessler, the federal prosecutor, said the nephew became an authorized redeemer for the Supplemental Nutritional Assistance Program, or SNAP. The father, in applying for assistance, said he worked as a $7.50-an-hour meat cutter at the store, the government in court documents.
“This allowed Ahmed to conceal the substantial income he derived from the store, so he could fraudulently apply for and receive federal welfare, housing, medical and educational benefits for himself and various members of his family,” Kessler wrote, in an indictment.
The government alleged $474,000 in food-stamp fraud.
It also said Mohamed and his family wrong received $46,605 in SNAP benefits; $4,313 in Women, Infant and Children benefits; $44,873 in rent subsidies; $57,963 in Medicaid benefits; $300 in emergency heating assistance; and $24,678 in Pell Grants.