Investigation uncovers food stamp fraud at Phoenix storePosted: Updated:
PHOENIX – An investigation has led to the identification of four Dollar Dayz general store employees involved in food stamp fraud, according to a report released by the Arizona Department of Economic Security (DES) and Arizona Attorney General Tom Horne.
“This is an unfortunate example of a business stealing taxpayer money by allowing a person with a food stamp card to purchase a small item and overcharge the card in order to make a profit,” Horne said. “With tens of thousands of dollars being claimed by a store with two aisles of food, it is physically impossible for Dollar Dayz to have made the volume of sales they are claiming.”
According to DES, the employees at Dollar Dayz general store located at 1602 W. Buckeye Road in Phoenix were identified for illegally conducting an enterprise, fraudulent schemes and artifices, money laundering, unlawful use of food stamps, and computer tampering.
The months-long undercover operation involved a multi-agency task force including the United States Department of Agriculture (USDA) Office of the Inspector General, Phoenix Police Department, the Arizona Attorney General’s Office, and the Arizona Department of Economic Security Office of Special Investigations.
“I commend all involved for their efforts to uncover this fraudulent behavior and bring to justice the individuals who would take advantage of a government program,” Gov. Jan Brewer said. “We will continue our efforts to protect the Arizona taxpayer and uphold the public trust.”
A special assignment unit of the Phoenix Police Department served search warrants on Wednesday at the general store to collect criminal and civil evidence, which can include cash, bank records, extraneous food stamp cards, and business ledgers, according to DES.
According to the release, it is alleged that the store provided cash to individuals in exchange for Supplemental Nutrition Assistance Program (SNAP) food stamp benefits in fraudulent transactions on multiple occasions during the investigation. USDA data estimates fraud against the SNAP program exceeded $700,000 from this store location since 2010.
According to DES, a typical criminal transaction involves the seller receiving a portion of the value of the card in cash and the buyer, the store owner in this case, removing benefits from the card through sham transactions.
“Unfortunately, there are those in our society who deliberately act to defraud the very system of benefits, good and services intended to help the people most in need in our community,” said DES Director Clarence H. Carter. “But with cooperation from local, state and federal officials, we are building and maintaining an agency-wide system of tools and controls that, combined with rigorous enforcements, will help us to ensure that these precious resources are reserved for those who are intended to receive them and used for their appropriate purposes.”
The USDA Food and Nutrition Service outlines the use of SNAP benefits for eligible food items. According to the USDA, the program, originally the federal Food Stamp Program changed the name to reflect changes made including a focus on nutrition and an increase in benefit amounts. SNAP benefits cannot be converted into cash.
According to DES, this is the second store busted for food stamp fraud in 2013 by this inter-agency group called "StrikeForce: Quest" after the Quest food stamp card.