MASTIC, N.Y. – New York Attorney General Eric Schneiderman and the U.S. Department of Agriculture Office of Inspector General announced the indictment of two co-owners of a Suffolk County convenience store on 25 accounts of illegally trading cash for hundreds of thousands of Supplemental Nutrition Assistance Program (SNAP) benefits.
One store employee and seven recipients of SNAP benefits, formerly known as food stamps, were also indicted.
"It's unconscionable that anyone would steal from a program designed to provide nutritional assistance to New Yorkers in need, especially those harmed by Hurricane Sandy," stated Schneiderman. "There has to be one set of rules for everyone, and that is why my office will hold these individuals accountable and attempt to recover the nearly $1 million stolen from this crucial program."
Mastic Supermarket Corp. co-owners and operators Manjeet Chadha and Sajjad Rashid, as well as their employee Haricharan Malhotra, are charged with felony grand larceny, misuse of food stamps, and falsifying business records for orchestrating a scheme to steal nearly $1 million from the government program, according to the Attorney General's Office. The seven SNAP recipients also face "significant" charges of grand larceny and misuse.
Rashid and Malhotra face up to 15 years in prison each if convicted, while Chadha faces up to seven years. Three of the SNAP recipients face up to seven years, while the remaining four who are charged with lesser counts of felony grand larceny and misuse face up to four years each.
"The Supplemental Nutrition Assistance Program was created to provide food and nutrition to those who truly need this assistance," stated U.S. Department of Agriculture (USDA) Office of the Inspector General Special Agent-in-Charge William G. Squires Jr. "Those who are involved in fraud and abuse of SNAP and other USDA programs will be aggressively pursued by our office. Our joint investigation with the Attorney General's Office and New York law enforcement partners has brought to justice several individuals who obtained approximately $1 million from the SNAP program through illegal schemes. The USDA Office of Inspector General will continue to dedicate resources and work with our state and local law enforcement partners in order to protect the integrity of these programs and to prosecute those who commit fraud."
Attorney General Schneiderman also filed a civil suit Monday that seeks restitution in the amount of $973,000 against Rashid, Chadha, Malhotra and Mastic Supermarket Corp., which was also criminally charged.
After Superstorm Sandy struck, the USDA allocated an additional 50 percent in benefits to all SNAP recipients in affected areas, without regard to need. The seven recipients charged in the indictment received this Sandy benefit and illegally exchanged their SNAP benefits for cash at Mastic Supermarket Corp. shortly after the storm, said Schneiderman's office.
According to the indictment, Rashid, Chadha and Malhotra processed phantom SNAP transactions in cooperation with the seven SNAP cardholders. The cardholders then received cash equaling half of the amount of these fake purchases, while Rashid, Chadha and Malhotra kept the remainder of the money for themselves.
The investigation shows that in the 10 months from March 2012 to December 2012, Mastic Supermarket Corp. rang up over $564,000 in SNAP benefits, significantly higher than redemptions in comparable stores nearby.