Oklahoma City Fraud Investigation Nets 30 Arrests

In 2009, Oklahoma's Department of Human Services (DHS) began an investigation into food stamp fraud in Oklahoma City.  Last week, the first arrests were made as a result of the department's sting operation.



During the fraud investigation, undercover agents and informants went to Oklahoma City area convenience stores and attempted to misuse food stamp cards to defraud the state.  According to investigators, most of the fraud occurred when store clerks gave undercover agents cash back from purchases made with food stamps. 

Food Stamp Fraud in Oklahoma

According to one Oklahoma fraud attorney, these types of charges are more common than you would imagine.

In one scenario, a grocery clerk gave an undercover agent $100 cash back from a $200 purchase that never actually occurred.  In other situations, an informant would use the food stamps to buy merchandise at one store and exchange it for cash at another store. 

For example, one store clerk paid $45 for beverages purchased for $104 in food stamps at another location. Another way the cards were used fraudulently is by store clerks who borrowed or purchased the food stamps for personal use.  One clerk paid an agent $101 to use a card to purchase $181 in groceries for his own family. While nearly 30 store clerks and owners have been arrested, the dollar amount of money defrauded has only been released in two cases.

Muluneh Zeleke, owner of the Z & Z convenience store in Oklahoma City, is accused of defrauding the Supplemental Assistance Nutrition Program, the food stamp program, out of $1,224,888 between March 2007 and February 2010. 

Police say Zeleke allowed customers to swipe their cards for cash, keeping half of the cash for himself.  The food stamp program expressly prohibits merchants from allowing customers to redeem the cards for cash.  Zeleke was indicted on one count of conspiracy to defraud and four counts of aiding and abetting food stamp violations. 

He faces five years in prison and $250,000 in fines for each of the five counts. Muhammand Zahid, owner of Oklahoma City's Ghani Mart, was indicted in a similar scheme, which defrauded the program out of $650,000 between December 2007 and September 2010. 

He has been charged with one count of conspiracy to defraud and five counts of food stamp violations. In addition to fines, prison, and probation, if convicted, the men accused of Oklahoma fraud will also be expected to forfeit the illegally accumulated money, paying restitution of nearly $1.8 million to the Supplemental Assistance Nutrition Program.

For More Information on Oklahoma Fraud Laws

If you're interested in reading about more cases or possible defense strategies for fraud please click here.

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