7 plead guilty to $5 million food stamp trafficking scheme

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Seven South Carolina women pleaded guilty on Thursday to committing more than $20,000 in food stamp fraud at a Rock Hill store. Three of the store owners are facing up to five years in prison for a $5 million food stamp trafficking scheme.

But the women were given a deal: plead guilty to misdemeanor fraud charges, pay the money back, and they will avoid jail time and probation.

The seven who pleaded guilty Thursday are: Kimberly Johnson, 28, $2,195 in fraud; Victoria Sanders, 25, $2,234; Dequitta White, 31, $3,070; Jatonica Williams, 31, $5,238; Brooke Rogers, 27, $2,134; Shenisa Davis, 36, $2,549; and Labrecia White, 24, $2,962.

Johnson pleaded guilty by herself while the other six copped their pleas in two groups of three.

Each defendant received a 30-day sentence in jail that was suspended, and two years probation that will be dismissed if all the money is repaid by Dec. 31.

The store owners were given the same deal, but they have to pay back as much as $5 million, according to Mark McKinnon, a 16th Circuit assistant public defender who represented three of the women.

Cash payoffs for purchases of cigarettes, gas and beer have been defrauding the government’s food stamp program for years, and this particular scam, which was uncovered last year, had been going on since 2009, according to a news report in the The Herald.

The three women who owned the Daily Express Mart in Rock Hill have been identified as Li Fang Phu, Hoang Nguyen and Dianne Phu, who all pleaded guilty in federal court last year in a plea deal. They are all said to be from Rock Hill.

According to the indictment, the Daily Express exchanged cash for food stamp benefits and also accepted food stamps for purchases of cigarettes, beer and gasoline. Some of the purchases charged to food stamps were reported to be as high as $59 for a bottle of beer and a pack of cigarettes.

Intended to help feed low- and middle-income families, retailers are authorized to accept food stamps only for food, and purchases are supposed to be used with a direct transfer card. No cash should be returned to the holder, said S.C. Assistant Attorney General Sam Jones.

The store owners did not appear in court along with the others, because they are still cooperating as witnesses in the food stamp scheme, and they won’t be sentenced in federal court until the case is closed.

Jones told the court that the food stamp scam had been going on among these and dozens of other store owners and customers from March 2014 to 2016. He prosecutes food stamp cases statewide and said the store owners were “trafficking” food stamps and exchanging benefits for cash. The seven women were repeatedly using their food stamps to make illegal purchases and even get cash back. They would buy hot food, a single beer, cigarettes, or gasoline with a food stamps debit card and receive cash back.

“Through a pattern of excessive transactions,” investigators found the incidents of up to $100 each time where people received illegal goods, money, or both, said Jones.

Food stamp fraud is also running wild on social media, according to a recent report, as people are buying and selling food stamps on social media sites such as Facebook, Twitter, and Craigslist.

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