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A.G. Schneiderman Announces Prison Terms For Two Suffolk County Convenience Store Owners In $1.6 Million Theft From Food Stamp Program

LongIsland.com

Attorney General Eric T. Schneiderman, along with the U.S. Department of Agriculture (USDA) Office of Inspector General, today announced the sentencing of two Long Island store owners who spent years stealing over $1.6 million from ...

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Hauppauge, NY - May 20, 2015 - Attorney General Eric T. Schneiderman, along with the U.S. Department of Agriculture (USDA) Office of Inspector General, today announced the sentencing of two Long Island store owners who spent years stealing over $1.6 million from the Supplemental Nutrition Assistance Program (SNAP, formerly known as the Food Stamp Program). Ravinder Parkash, 60, of Riverhead, stole more than $668,000 from the USDA by illegally exchanging SNAP benefits for cash and submitting fraudulent transactions for payment at his Riverhead convenience store. Sajjad Rashid, 43, of Rocky Point, an owner and manager of Mastic Supermarket, orchestrated a similar multi-year fraud scheme in which he illegally traded cash for almost $1 million in SNAP benefits.

Parkash and Rashid were each sentenced today in Suffolk County Supreme Court by Justice John B. Collins. Parkash was sentenced to 1 1/3 to 4 years in state prison and ordered to pay restitution in an amount of $566,011.49. Rashid was sentenced to 2 1/2 to 7 1/2 years in state prison and ordered to pay restitution of $974,619. These convictions are the result of a multi-year investigation into SNAP fraud in Suffolk County initiated by the USDA and the Attorney General’s Criminal Enforcement and Financial Crimes Bureau.

“Both of these schemes not only ripped off taxpayers, but also the many New Yorkers in need who depend on food stamp benefits, specifically those harmed by Hurricane Sandy,” Attorney General Schneiderman said. “My office will continue to take aggressive action against SNAP Trafficking, including pursuing criminal charges and prison time.”

The Attorney General’s investigations revealed that Parkash and Rashid both engaged in fraud known as “SNAP Trafficking.” In a SNAP Trafficking scheme, the vendor conspires with individual SNAP recipients to ring up purported grocery sales, but no goods are actually sold. Instead, the shop owner or employee gives 50% of the sales price to the SNAP recipients in cash and keeps the other 50% for themselves. The USDA is then charged the full value of these phony transactions.

The evidence in both cases showed that on hundreds of occasions, SNAP recipients entered the Suffolk County convenience stores and presented their SNAP benefit cards to the defendants at the registers. The defendants rang up sham purchases and gave 50% of the sales price, in cash, to the SNAP recipients. The USDA then paid Parkash and Rashid the full value of the phony transactions, and the defendants pocketed the difference.

In the wake of Hurricane Sandy, the USDA provided emergency benefits to all SNAP recipients in affected areas, including Suffolk County, without regard to need. Dozens of SNAP recipients exchanged these Sandy benefits for cash with Parkash and Rashid.

Between April 2010 and May 2013, Parkash conspired with his wife Prabha Rani, 59, and his corporation, Shivani Enterprises, Inc., located at 415 East Main Street, Riverhead, New York, to use the Gulf gas station and convenience store to exchange SNAP benefits for cash. Parkash then laundered the proceeds of his illegal scheme by using a bank account set up to process New York State Lottery sales at the store. On January 12, 2015, Parkash and Shivani Enterprises pleaded guilty to all counts of the indictment, including Grand Larceny in the Second Degree, Money Laundering in the Second Degree and Conspiracy. Prabha Rani also pleaded guilty to the indictment for her role in the scheme, and on April 17, 2015 she received a 60-day jail sentence.

From at least March 2012 to June 2014, Rashid led a ring of corrupt store owners and clerks at Mastic Supermarket Corp., located at 1088 Mastic Road, Mastic, New York, who rang up nearly a $1 million dollars in phony food stamp transactions at taxpayer expense. Rashid, co-owner and manager of Mastic Supermarket Corp., which operated under the name “Shop With Us Quality Foods,” conspired with co-owner Manjeet Chadha and clerk Haricharan Malhotra to fraudulently exchange food stamps for cash. On March 12, 2015, Rashid pleaded guilty to Grand Larceny in the Second Degree, among other charges. Malhotra and Chadha also pleaded guilty to participating in the scheme; Malhotra was sentenced to 1 1/3 to 4 years in prison and Chadha to 840 hours of community service.

In addition to the shop owners and employees, 30 SNAP recipients charged in the Attorney General’s indictments have pleaded guilty to the crime of Misuse of Food Stamps.

Attorney General Schneiderman thanks: the United States Department of Agriculture, Office of Inspector General, Northeast Region, including Special Agents Christopher Santangelo and Angel Plaza; the Suffolk County Department of Social Services, including Investigator Thomas Liguori and Investigation Supervisor Rebecca Hodge; the United States Department of Agriculture, Food and Nutrition Service; the Suffolk County Police Department; and the New York State Department of Financial Services, for their assistance in this matter.

The case is being handled by Assistant Attorneys General Tyler Reynolds and Rhonda Greenstein of the Attorney General’s Criminal Enforcement and Financial Crimes Bureau. The bureau is led by Bureau Chief Gary T. Fishman and Deputy Bureau Chiefs Meryl Lutsky and Stephanie Swenton. The civil case is being handled by Assistant Deputy Attorney General Brian Moore of the Attorney General’s Organized Crime Task Force. The Division of Criminal Justice is led by Executive Deputy Attorney General Kelly Donovan.

The Attorney General recognizes the diligent work of the Office of the Attorney General’s Criminal Division staff, including Legal Support Analyst Theodore Davidson, Investigators Steve Pratt and Vincent Gisonti, Senior Investigator Dennis Maddalone, Supervising Investigator John Sullivan and Deputy Chief Investigators John McManus and Greg Stasiuk. Dominick Zarrella is the Chief Investigator.

If see or know of waste, fraud or abuse in a social services program in New York State, please contact the Office of the Attorney General's helpline at (800) 771-7755.