President Donald Trump’s administration busted a $66 million food stamp fraud ring in New York.
U.S. Department of Agriculture employee Arlasa Davis had one job: stop food stamp fraud. Instead, she allegedly accepted bribes and caused $36 million of fraud over three years by sharing government data.
The Department of Justice charged six people for stealing over $66 million in food stamps from the Supplemental Nutrition Assistance Program in late May.
Every year, the federal government gives billions of dollars to poor Americans who spend that money at over 250,000 licensed retailers ranging from grocery stores to bodegas.
The SNAP program uses federal tax dollars to help low-income households purchase food using Electronic Benefit Transfer cards. The federal government licenses stores to use EBT terminals to process EBT funds from the bank account to the store’s account.
The alleged criminal ring – Michael Kehoe, Mohamad Nawafleh, Omar Alrawashdeh, Gamal Obaid, Emad Alrawashdeh, and Arlasa Davis – are charged with conspiracy to steal government funds and to misappropriate USDA benefits.
In 2019, Kehoe supplied 160 unauthorized EBT terminals to smoke shops and other ineligible stores across the New York area to illegally process more than $30 million in EBT transactions.
The crime ring submitted about 200 fraudulent USDA applications, misappropriating USDA license numbers and, in some cases, doctoring application documents, to obtain EBT terminals for unauthorized stores.
The criminals sold hundreds of EBT license numbers enabling over $36 million in fraudulent SNAP redemptions at unauthorized stores. Davis photographed lists of license numbers intended for qualifying stores and texted them to someone who sold them to co-conspirators, who then used those license numbers to fraudulently obtain EBT terminals for stores that were not authorized by the USDA to process SNAP transactions.
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The criminals could face decades in prison.
“Michael Kehoe and his co-conspirators misappropriated tens of millions of dollars in taxpayer funds meant to help low-income families put food on the table,” said U.S. Attorney Perry Carbone. “This fraud was made possible when USDA employee Arlasa Davis betrayed the public trust by selling confidential government information to the very criminals she was supposed to catch. Their actions undermined a program that vulnerable New Yorkers depend on for basic nutrition.”
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