Food Stamps

The SNAP program has a relatively low fraud rate of 3.8% in the general program and 1% on the black market. Part of keeping it so low is that authorities are quick to investigate claims of fraud and shut it down, and the case of Ebraheem Maki Naif of St. Louis is the latest example.

The Case

Abes Gravois Discount and Gravois Discount Smokes is on US-66, affectionately known as the Main Street in America. It’s a route that millions of people have designated for their road trip because of how it hugs the land, going around landmarks instead of cutting through them. So when Naif decided to set up shop there, he was smart in picking the location.

What the 51-year-old wasn’t so smart about, though, was how he tried to fix the poverty problem. He knew that people had addictions to smoking, and perhaps thought it unfair that they should have to struggle with both an addiction and not getting enough to eat. Or perhaps he just wanted a bit of extra cash in his pocket: until his side of the story gets out, it’s all speculation on why he did what he did.

The Fraud

Despite his motivation behind it, one clear conclusion can be made. Naif knew what he was doing was against the law, and willfully went ahead with it, anyway. Every business owner in America has to report annual earnings to the IRS so they can pay taxes accordingly, and Naif knew this. He knew this so thoroughly, he understood that if he claimed less, it would mean more money for him and less for Uncle Sam. And because he accepted food stamps at his store, he also had to report that number to city officials.

He reported numbers, but they weren’t the right ones. In 2011, Naif redeemed $690,198 in food stamps, and reported $80,800 in gross receipts for merchandise worth $25,750. The total losses he admitted causing that year? A staggering $609,398.

In total, though, that figure goes much higher. He may have claimed a total of $690,198 in food stamps, but the benefits he redeemed added up to $1,903,402. For this, he allowed people to use their food stamps on cigarettes, cologne and telephone calling cards, as well as cold, hard cash, too. Anyone who’s the least bit familiar with the SNAP program knows that food stamps can’t be used for these kinds of purchases, especially with Fox News trumpeting it every week.

The Conclusion

Naif pleaded guilty to one felony count of food stamp fraud before the federal court, which means that his case won’t be over just like that. Felony counts tend to take a little bit longer to get through, but the fact that Naif pleaded guilty does make it a lot clearer.

Along with pleading guilty, he’s also agreed to forfeit $30,765 and one vehicle, and faces up to 10 years in prison and/or fines up to $250,000. What his punishment will be will be determined during his sentencing, as pleading guilty is only the first step in a conviction.

The lesson? Yes, fraud in the SNAP program does occur, but it also gets found out, too. And the even more important lesson? It’s best not to do it in the first place, or else you’ll face nationwide notoriety and heavy penalties just like Naif is.