Fraud News Update 10.2.14

Fraud News

Fraud News

Fraud News Update 10.02.14: This week’s Fraud Solutions news update features: Arrrrrrrrrrrrrmy Training, Sir! (More Fuel Fraud Capers), Food Stamp Fraud Frenzy (Hamtramck gets on the SNAP map!), the Connection Between Death, Medicaid, Student Loans and Food Stamps (See the Suspect),”The Situation’s” Situation (For You Jersey Shore Fans), Price Fixing (The Boat Rolls On) and Theft in the Temple (Oy Vey! What a Schmuck).

Read on for more topical information and our insights, observations and unique commentary on the weekly fraud news.

What Kind of Training, Son? Arrrrrrrrrrrrrmy Training, Sir!

In what seems like it should be a scene from the 1971 comedy classic, Stripes,  starring Bill Murray and the late, great, actor Harold Ramis, this fraud news story featured another kind of army activity. Only this time, it wasn’t comedy but nefarious criminal activity. According to the Department of Justice,

“An Army sergeant pleaded guilty today to bribery and conspiracy to defraud the government for his role in a scheme to steal more than one million gallons of fuel from the U.S. military for resale on the black market in Afghanistan.”

The government places losses at more than $10,000,000. Your government tax dollars at work.

From last week’s Fraud News Update where we featured the theft of used cooking oil to this week’s story about petrol theft, we know that fuel’s a commodity. Where there are commodities, there’s fraud. Instead of saying “follow the money” perhaps we should be saying “follow the fuel!”

Food Stamp Fraud Frenzy

The feeding frenzy is on in what can only be described as a “food stamp fiasco!” Since the release of the IG’s report, the store shelves have been littered with stories about rampant abuses in the program.

In this fraud news story, the feds say they’ve “uncovered $12.5 million in fraud” occurring in Hamtramck, MI., and have indicted 11 individuals in a cash for benefits scam. The added kicker, store owners are alleged to have added financial surcharges for providing the cash to cardholders. It’s a supply and demand black market, underground economy… calling Mr. Capone.

Analyzing fraud patterns is a key to forecasting trends and future fraud prevention efforts. The indicted are:

Al Amin Supermarket, 11920 Conant, Hamtramck, owner Moklasur Mukul, age 36, of Hamtramck;

Bengal American Grocery, 9800 Joseph Campau Avenue, Hamtramck, manager Mohamed Ali, age 38, resident of Detroit;

Deshi Bazar, 12045 Conant Street, Hamtramck, owners Ali Ahmed, age 31, and Nazir Ahmed, age 32, and employee Mustak Ahmed, age 34, all residents of Detroit;

Maloncho Greens House, 12133 Conant Street, Hamtramck, owner Azizur Ullah, age 37, of Hamtramck, and employees Mohammed Chadek, age 44, Mohammed Miah, age 38, and Mohammed Amin, age 38, residents of Hamtramck;

New Al-Madeena Grocery, 2220-2222 Caniff Street, Hamtramck, owner Dilshad Chowdhury, age 34, resident of Hamtramck.

Pay-Less Foods, 11350 Joseph Campau Avenue, Hamtramck, owner Mohamed Ahmed, age 58, resident of Hamtramck;

If race, ethnicity or nationality are factors in organized crime as suggested by researchers, anyone see any patterns or connections in this case? Apparently, the feds did.

In contemplating the age-old chicken vs. egg question, we’re pondering what came first: the investigations or the IG’s report? We don’t know if the investigations were already in the works prior to the report or whether the rash of cases are a direct reaction to the scathing information contained in it.

Whatever the case, the game’s afoot for federal agents who must have gotten the “stop the stamp fraud” message from Justice Department officials in DC.

The Connection Between Death, Medicaid, Student Loans and Food Stamps

In case you’ve ever wondered what the connection is between death, Medicaid, student loans and food stamps, then Rachel Hardy-Johnson might be your answer.

Aside from facing a variety of charges related to disrespecting corpses in her failed funeral home business (evicted from the business and the landlord found a number of dead bodies lying around after they vacated the premise), the feds have a separate case which paints Hardy-Johnson as an equal opportunity criminal.

According to the U.S. attorney’s office, “Hardy-Johnson, 35, was indicted last week and faces one count of food stamp fraud, two counts of theft of federal public money and one count of theft of educational funds.”

Hardy-Johnson surrendered to federal authorities Monday. The irony here is her fashion choice while doing the “perp walk” with federal agents. The ensemble includes a pink “Wonder Woman” shirt and sweats which read: Crazy Love. Apparently there was “no love” shown to the corpses.

“This is the Golden Lasso. Besides being made from an indestructible material, it also carries with it the power to compel people to tell the truth” (Wonder Woman). Apparently, the feds don’t think that the Golden Lasso worked on Hardy-Johnson!

Once more, there’s a reality TV spin to this fraud story as the Johnson’s were scheduled to be featured in a Lifetime Network TV Reality Show called “Good Grief.” However, Lifetime quickly dropped the planned show once the mortuary related arrests were made.

Another popular reality show, Sons of Guns, recently met a similar fate when it was dropped by the Discovery Channel after Will Hayden, of Red Jacket Firearms, was arrested and charged with aggravated rape of a juvenile, forcible rape and indecent behavior with a juvenile. It’s called “reality TV” for a reason.

“The Situation’s” In Quite A Situation (Pickle)

For those of you who follow reality television, there’s no more reality than this fraud news story: The feds have indicted Mike, “The Situation,” Sorrentino, of Jersey Shore fame, and his brother Marc, with income tax fraud for failing to pay taxes on almost 9 mil in earnings.

According to news sources, “The Situation’s” response: Throw your brother under the bus! It’s all his fault! (1971 Carly Simon lyrics come to mind: “You’re So Vain!”) Nothing like a little family love. That ought to make for fun and frivolity at the next Thanksgiving family dinner.

If the past is any indication of the future, let’s see how similar charges wound up for inmate: 43355-018. 43355-018 had accounting representation according to testimony presented at trial in federal court. 43355-018 argued that he relied on advice from his financial advisers in dealings with the IRS so he shouldn’t be responsible for failing to pay taxes.

43355-018’s defense didn’t fly with the Jury or the Court and he got three years in the federal hoosegow. If Mike “The Situation” Sorrentino wants to know how this is going to play out for him, and he was relying on his brother for financial advice, he should go ask 43355-018, otherwise known as actor Wesley T. Snipes.

He can also consult with inmate: 64600-050 (Lauryn N. Hill – former lead singer of the Fugees). Both celebrities were “singing the blues” in federal prison for the same charges. Snipes got 3 years – Hill got 3 months. If “The Situation’s” convicted at least he’ll have an idea how long his next vacation’s going to be.

What we know about history is that its not looking good for the Sitch.

Price Fixing – The Boat Rolls On

Several fraud news updates have featured organized price-fixing and big rigging cases in the ongoing criminal investigation into the auto industry. This time, however, it’s not the auto industry. In this fraud news story, it’s organized maritime mayhem as a Japanese company pleads guilty and is going to pay an almost $70,000,000 fine for their role in shipping fraud to and from the U.S.

Theft in the Temple

Finally, last week was the first week since we started the Fraud News Update series that we were free of religious stories involving “pilfering from the pews.” Just when you thought your faith in the profession was restored, from La Jolla (an affluent beach community in SoCal), comes this fraud news story involving “stealing from the synagogue.”

As I’ve written about in the past, the Fraud’s in the Files and this case was no different. According to the FBI, while using the synagogue’s money for lavish personal expenses, the congregation’s Executive Director “hid thousands of dollars in payments to himself by creating entries for legitimate expenses of the synagogue, in categories such as “Ritual Fund,” “Rabbi Emeritus,” “High Holidays,” “Purim Baskets,” “janitorial expense,” “utilities,” “landscaping expense,” and “repair/replace reserve fund.”

How fiscally creative. Isn’t that Special?! The Bureau places total losses at just over half a mil.

Fraud News – The Bottom Line

Fraud – empowering people to break the law. It’s a way of life for some and every fraud has a story. At Fraud Solutions, fraud is our world and we’re passionate about prevention. Being proactive is key, so, follow us each week as we cover the fraud beat with added insights, information and unique commentary on stories making the fraud news.

Those are our insights. What are yours?