Two Texas Men Charged with $1.9 Million Food Stamp Fraud

Two Texas Men Charged with $1.9 Million Food Stamp Fraud

on Sun, 16 Feb 2014

Dallas convenience store owner Kamardeen Ogunleye and manager Robert Gordon have been charged with running a food stamp scam costing taxpayers $1.9 million.

The scheme, laid out in an indictment unsealed on Friday, alleges that Ogunleye and Gordon bought food stamps by paying welfare recipients 50% of the cash value of their benefits before depositing the redeemed full value in Ogunleye's bank accounts. The food stamp fraud allegedly took place from March 2010 to September 2013.

Both men have been charged with one count of conspiracy to commit food stamp fraud, five counts of food stamp fraud and aiding and abetting, and six counts of wire fraud.

The Texas bust is just the latest instance of food stamp fraud.

On Wednesday, Sandra Flores of Tacoma, Washington was sentenced to 30 days of incarceration and a $120,000 fine for running a cash-for-food stamps scam at her store, La Popular Cash and Carry.

In Baltimore, Abdulmalik Abdulla and Ahmed Mohssen were charged last month with running a food stamp scam costing taxpayers $1.5 million. "Taxpayers fund the program to provide food for needy recipients, not to turn retail store cash registers into ATM machines," said U.S. Attorney Rod J. Rosenstein.

With food stamp enrollments skyrocketing in America, food stamp schemes continue to flourish. As a Government Accountability Institute report revealed, some welfare recipients now buy and sell their taxpayer-funded food stamp benefits on social media websites, such as Craigslist and Backpage.

Another food stamp scheme involves individuals fraudulently reporting their cards as lost or stolen to receive replacement cards to score more dollars. For example, New Mexico has seen unusually high rates of food stamp cards reported lost or stolen. Of the 138,927 food stamp cards issued to New Mexicans in 2012, over 93,000 were replacement cards--nearly70%.

On Saturday, New Mexico House of Representatives voted 65-0 to pass a bill stiffening penalties for fraudsters seeking to turn their food stamp benefits into quick cash. 

"You have instances where people were continually committing fraud and we couldn't really aggregate those into a felony. That's what this bill will do," said Rep. Monica Youngblood (R-Albuquerque).

Since January 2009, the number of individuals on food stamps in America has skyrocketed from 31.9 million to 47 million.