Teams of Alabama law enforcement officials this morning executed 242 search warrants and made 17 arrests as part of “Operation T-Bone,” an extensive, multi-agency crackdown on food stamps fraud. Investigators filed for forfeiture and condemnation of 11 stores alleged to be involved in the fraud, totaling over $1 million in assets. The Jefferson County District Attorney’s Office launched the investigation back in February, and now claim to have proof that the individuals arrested bilked the taxpayer-funded food stamps system for hundreds of thousands of dollars. They also uncovered evidence that some of the ill-gotten gains were wired to Yemen.
Over 900,000 Alabama citizens get government assistance through EBT cards each year. These cards can be used to purchase food and non-alcoholic drinks through the Supplemental Nutrition Assistance Program (SNAP). Investigators allege that the business owners arrested would purchase these EBT cards from welfare enrollees for $0.50 on the dollar, and use the cards to make wholesale purchases of food and drinks to sell in their stores. The person selling their EBT card would then be able to spend the cash on alcohol, tobacco, illicit substances, or whatever they want.
“Part of the problem, in my opinion, is now they don’t have their food stamps card so they don’t have the money to take care of their families or themselves,” says Deputy District Attorney Cynthia Raulston. “I think it’s a huge cycle of remaining impoverished.”
The investigation had humble beginnings – Gardendale police arrested a man for shoplifting steaks and other items from the local Wal-Mart, and when he was questioned, he claimed he was giving the stolen merchandise to two local convenience stores to resell. When investigators called Wal-Mart’s Global Investigations Unit to see if they wanted to probe further, they were told that Wal-Mart was already investigating those stores for EBT fraud. Investigators learned not only of the scheme to buy EBT cards and purchase stock with them, but also that stores would overcharge for an item and give the cardholder cash back on their purchase.
Raulston called the problem “pervasive” and rampant, saying all it took to fraudulently obtain an EBT card is to walk into the community and mention a beneficiary card. Another concern, beyond the theft of taxpayer funds, is the inflated prices caused by EBT card fraud. According to Raulston:
“One of the biggest issues is they’re marking up these items in the stores and charging more than what retailers would charge and they’re in the middle of food deserts with no transportation so they don’t have a lot of options” … “It’s not only the EBT card beneficiaries, but you’ve got the working poor paying marked up prices. They’re getting ripped off.”