1

Office of Inspector General / U.S. Department of Agriculture

Investigations Bulletin

August 15, 2018

Two Defendants Sentenced for SNAP and WIC Trafficking Scheme; Store Owner 

Ordered to Pay $1.4 Million in Restitution—Maine 

On June 18, 2018, in U.S. District Court, District of Maine, two brothers, a store owner and a clerk, were 

sentenced for a trafficking scheme involving the Supplemental Nutrition Assistance Program (SNAP) and 

the Special Supplemental Nutrition Program for Women, Infants and Children (WIC). The store owner was 

sentenced to 3 years in prison and was ordered to pay $1.4 million in restitution ($954,900 of which is joint 

and several with his brother). The store owner was also ordered to forfeit $80,800 seized during the search 

and seizure executions. The second defendant, the store clerk, was sentenced to 2 years in prison and 

$954,900 in joint and several restitution. This joint investigation1

 determined that the store was trafficking 

in SNAP benefits. Both defendants were charged with conspiracy to defraud and commit offenses against 

the United States. The store owner pled guilty to conspiracy to commit food stamp fraud, WIC trafficking, 

money laundering, and theft of Government funds. The store clerk was found guilty of conspiracy in a jury 

trial. 

Defendant Sentenced and Ordered to Pay $81,190 Restitution to USDA for False 

Statements Pertaining to RD Grant Funds—New Hampshire 

On June 15, 2018, in U.S. District Court, District of New Hampshire, a forestry institute’s executive 

director was sentenced to 1 year in prison and ordered to pay $81,190 in restitution to USDA. The 

investigation was initiated upon allegations that the defendant issued a fraudulent bill for payment, wrote a 

bad check, and provided fraudulent invoices to the Rural Business-Cooperative Service (RBS) in 

connection with $81,300 in Rural Business Enterprise Grant funds. OIG’s investigation revealed that the 

defendant submitted multiple Requests for Advance or Reimbursement containing false information. These 

requests created the impression that the forestry institute spent funds for authorized grant purposes and 

enabled the defendant to draw down grant funds. The defendant admitted to RBCS personnel that the grant 

funds were not used in accordance with the approved scope of work and that she manufactured contractor 

invoices. The defendant was found guilty of false statements at trial. 

Defendant Sentenced and Ordered to Pay $194,200 for Fraud Involving 

CACFP Funds—Wisconsin 

On June 28, 2018, in U.S. District Court, Eastern District of Wisconsin, the owner of a learning academy 

was sentenced to nine months in prison and ordered to pay $194,200 in restitution. The learning academy 

participated in the Food and Nutrition Service’s (FNS) Child and Adult Care Food Program (CACFP). The 

investigation was conducted to determine if the owner illegally obtained the CACFP funds. The 

OIG investigation disclosed that the defendant made false representations claiming he was a majority owner 

in the business to a bank and the Wisconsin Department of Public Instruction. By claiming to be a majority 

owner rather than correctly stating he was a minority owner, he was able to have sole access/authority for 

1 USDA OIG, the Federal Bureau of Investigation, the Internal Revenue Service (IRS)-Criminal Investigation

division, and the Maine Department of Health and Human Services participated in the investigation. 
2

the bank account. Using this access, he embezzled CACFP funds from the business account and used the 

funds to take numerous personal vacations. 

Former USDA Employee Sentenced for Theft of Government Funds—Oregon 

On June 13, 2018, in U.S. District Court, District of Oregon, a former USDA employee pled guilty to theft 

of Government funds and was sentenced to 2 years of probation, 40 hours community service, and ordered 

to pay $1,050 in restitution. This was a joint investigation2 into the use of the GSA Fleet Card by an 

employee of the Agricultural Marketing Service (AMS). The employee was terminated for unrelated issues 

subsequent to the opening of the investigation. 

Two Defendants Sentenced Related to SNAP Fraud Scheme, Ordered to Pay 

$693,200 in Restitution—California 

In June 2018, a store owner and a store employee were sentenced in U.S. District Court, Eastern District of 

California, for their roles in a SNAP trafficking scheme in a market. On June 11, 2018, the store’s manager 

was sentenced to 21 months in prison and was ordered to pay $693,200 restitution, jointly and severally, 

with an employee of the store. Two weeks later on June 25, 2018, a store employee was sentenced to 27 

months in prison and ordered to pay $693,200 in restitution, jointly and severally, with the manager. 

OIG initiated an investigation upon receiving a referral from FNS’ Retailer Investigations Branch (RIB) and 

the Merced County District Attorney’s Office Investigations Unit about possible SNAP trafficking at the 

market. During this joint investigation,3 the employee exchanged SNAP benefits for cash on several 

occasions. The manager admitted that she was responsible for making large cash withdrawals she knew 

would be used for trafficking SNAP benefits. Both defendants were charged with multiple counts related to 

the fraud scheme and ultimately pled guilty to conspiracy to commit wire fraud. 

Defendant Ordered to Pay $101,400 in Restitution Related to Receipt of Federal 

Benefits—Oregon 

On May 30, 2018, in U.S. District Court, District of Oregon, a SNAP recipient accepted a diversion 

agreement and agreed to pay $101,400 in restitution pertaining to improperly received Supplemental 

Security Income (SSI) and medical benefits. The defendant accepted the agreement in lieu of 

prosecution. The joint investigation4 determined that at least two family members resided in a foreign 

country and received SNAP, SSI, and medical benefits that were provided to ineligible relatives residing in 

the United States. The defendant sentenced above submitted an application for SNAP, Social Security, and 

health care benefits that contained false statements. 

2 USDA OIG and the General Services Administration (GSA) OIG participated in this investigation.

3 USDA OIG and the U.S. Marshals Service participated in the investigation.

4 Previously, two other family members convicted in the case received sentences that included restitutions of 

$220,500 and $142,000, respectively. Another family member is currently a fugitive. This was a joint investigation 

conducted by USDA OIG, SSA OIG, State of Oregon, and the U.S. Department of Justice.