Springfield Store Owner Arraigned in Connection with EBT Fraud, Operating Illegal Gaming Machines
SPRINGFIELD – The owner of a Springfield convenience store and market has been arraigned in connection with the unlawful use of Electronic Benefit Transfer (EBT) cards and defrauding the Supplemental Nutrition Assistance Program (SNAP), known commonly as “food stamps,” Attorney General Martha Coakley’s Office announced today. Authorities also found illegal gaming machines in his store.
Julio C. Rodriguez, age 55, of Springfield, was arraigned today in Springfield District Court on charges of Larceny over $250, Food Stamp Trafficking, and Unlawful Operation of a Gaming Device.
At the arraignment, presided over by Judge William Boyle, Rodriguez pleaded not guilty to the charges. Rodriguez was released on personal recognizance with the condition that he must surrender his passport. He is due back in Springfield District Court on Feb. 18, 2015 for a pre-trial conference.
Rodriguez was arrested last night after Massachusetts State Police assigned to the AG’s Office executed a search warrant at his store, Bethania’s Fish and Meat Market (Bethania’s), located on Main Street in Springfield. The AG’s Gaming Enforcement Division, the AG’s Digital Evidence Lab, State Police assigned to the Hampden County District Attorney's Office, and Springfield officials assisted in the execution of the search warrant.
After receiving a referral from the United States Department of Agriculture – Office of Inspector General (USDA-OIG) in September 2013, the AG’s Office began an investigation into the alleged fraudulent use of EBT SNAP cards at Bethania’s.
Bethania’s in Springfield is a convenience store with fish and meat counter. The store is authorized by the USDA to accept SNAP benefits from customers for eligible items. Authorities allege that Rodriguez engaged in a scheme to traffic SNAP benefits in exchange for cash. As part of the scheme, a customer would present their EBT card to Rodriguez, who would swipe the customer’s EBT card and enter fraudulent information on a dedicated EBT terminal indicating that a customer purchased eligible groceries. Rodriguez would allegedly furnish cash to the customer for half of the amount charged to their EBT card account.
For example, if an EBT card customer wanted $50 in cash, Rodriguez would allegedly provide the customer with $50 cash and fraudulently enter a $100 grocery sale. The store account would subsequently be credited with $100 from the customer’s EBT SNAP account, providing the store with a $50 profit on the transaction. The SNAP program does not allow cash to be exchanged in lieu of benefits.
In last few months of this scheme, authorities allege that Bethania’s had been transacting roughly $30,000 per month in EBT sales. Nearly two-thirds of those transactions each month were for purchases of more than $75 and are indicative of fraudulent activity.
During the execution of the search warrant, authorities also discovered ten gaming machines in the store.
Bethania’s also has a license to sell tobacco products. AG Coakley has advocated for the revocation of tobacco and lottery licenses when a business and/or owner is convicted of EBT fraud.
The investigation is ongoing.
These charges are allegations, and the defendant is presumed innocent until proven guilty.
In September 2013, Pat Lu, owner of Lotto Luck in Quincy, pleaded guilty to charges in a similar scheme and was sentenced to two-and-a-half years in the House of Correction, with ten years of probation to serve upon completion of his sentence. He was also ordered to pay $285,000 in restitution.
In November 2013, Hassan Mounajed, the manager of a Waltham convenience store, pleaded guilty to charges in another similar scheme. He was sentenced to six months in the House of Correction, with 44 months of probation to serve upon his release and was ordered to pay $34,000 in restitution.
Also, in April 2012, multiple individuals were charged in connection with selling their SNAP benefits at certain Massachusetts locations, knowingly accepting cash in lieu of groceries. Seventeen of those defendants have been sentenced to various terms in connection with those charges, including time in the House of Corrections, probation, and restitution.
In July 2013, the Department of Transitional Assistance (DTA) entered into a State Law Enforcement Bureau (SLEB) agreement with the USDA-FNS. The SLEB agreement enabled the Commonwealth to utilize state and local law enforcement agencies to investigate and pursue SNAP EBT fraud and abuse, including SNAP trafficking. Under the agreement, DTA has the authority to conduct investigations into possible SNAP fraud and Massachusetts law enforcement will be able to obtain EBT benefits from USDA-FNS for purposes of undercover investigations. To date, DTA has signed 106 sub-agreements with local law-enforcement across the Commonwealth, including the Attorney General’s Office and the Springfield Police Department.
The case is being prosecuted by Assistant Attorney General Michael Pine of AG Coakley’s Public Integrity Division with assistance from Financial Investigator Stephen Bethoney of the AG’s Financial Investigations Division. The investigation was handled by Massachusetts State Police assigned to the AG’s Office, with assistance from the AG’s Digital Evidence Lab and State Police assigned to the Hampden County District Attorney's Office. Investigators from the Department of Transitional Assistance (DTA) and the U.S. Department of Agriculture – Office of Inspector General assisted in the investigation.