A new Jersey man named Muhammad Shahbaz faces up to 5 years in prison, after being convicted of running an elaborate $3 million dollar food stamp fraud.
NJ.com reported that a Jersey City man is facing up to five years in prison after he pleaded guilty a federal court in Connecticut on June 17 to allowing food stamp recipients to sell their benefits for cash and buy restricted items.
Muhammad Shahbaz, 50, admitted that he charged recipients double the value for items restricted by the federal Supplemental Nutrition Assistance Program (SNAP), including cigarettes, a tall glass bong and other items at the WB Trade Fair Grocery store in Waterbury, Connecticut, where he worked for a family member.
How does the “food stamp” fraud work? USA Today put together this video to explain some of the tactics people use to steal money from American taxpayers.
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A New Jersey man is facing up to five years behind bars for running a nearly $3 million food stamp fraud operation at a Connecticut store.
Muhammad Shahbaz, 50, told investigators that he charged people who receive food stamps through the Supplemental Nutrition Assistance Program (SNAP) double for items that were not allowed to be purchased with benefits at WB Trade Fair Grocery store in Waterbury, Connecticut, NJ.com reported.
He also allowed SNAP recipients to trade their benefits for cash at half price and ran the scheme with three other employees at the store.
Shahbaz is also related to the store’s owner.
During an 18-month period between 2015 and 2016, the store received $3.2 million in food stamp payments from customers, but authorities found the store should have received only between $180,000-$360,000 over that same time period.
Shahbaz will be sentenced in an October court hearing, where he will likely receive five years in prison.
Food stamp fraud has become a criminal enterprise among convenience store owners trying to make a quick buck, and is one of the ways the federal government loses billions of dollars each year.
A Government Accountability Office (GAO) report from 2019 found that criminals were responsible for trafficking at least $1 billion in food stamp benefits.
Last March, Florida law enforcement officials busted nearly 200 people on food stamp fraud charges while they carried out an undercover law enforcement investigation.