Food Stamp Fraud Sentence in Calcseieu Parish – KPLC TV Lake Charles

Nash brothers sentenced in federal court for food stamp fraud
Posted: Aug 16, 2012 10:33 AM CDT
Updated: Aug 16, 2012 8:26 PM CDT
By Theresa Schmidt – bio | email
Craig and Hillary Nash III, of Lake Charles, were sentenced Thursday in federal court before U.S. Judge Patricia Minaldi.

The brothers, along with their sister, Rosalyn Mary Hilliard, were indicted in May 2011 in a 26-count indictment charging conspiracy, wire fraud and food stamp fraud.

Craig Nash was sentenced to six and a half years in prison and ordered to pay $1.7 million in restitution.

Hillary Nash was sentenced to six months in prison and was ordered to pay $62,515 in restitution.

The indictments came after an investigation involving Goodfellas Grocery in Lake Charles.

U.S. Attorney Stephanie A. Finley says the total amount of money embezzled totaled $1,784,135.51. An earlier news release indicated the Goodfellas store redeemed more than $2.7 million dollars from the federal government program.

After the sentencing Finley said, “We hope it sends a message that we’re watching. I mean, this is a serious sentence. We want them to know that we will vigorously prosecute this case. Our prosecutor in this case, Mr. Namie, along with the agents at USDA did a lot of good work and they’ve done a lot of hard work. They’re going to continue to investigate these cases because we’re not going to allow the fraud on the taxpayers.”

“These are very serious crimes that affect the community as the judge said. These were taxpayer dollars. They were intended who really need, children, families who needed the benefits of the food stamp program. We’re not going to allow the fraud on the community and the taxpayers. We also want the people who are going to these stores and getting cash and not getting food but getting beer and wine, we’ll be looking at them as well,” said Finley.

In court, Craig Nash seemed to try to justify his crimes saying he was trying to save his failing business. But Judge Patricia Minaldi didn’t buy it in light of legal alternatives such as bankruptcy– and that their lifestyle included luxury cars and property now being forfeited to the government. They are being allowed to keep their personal homes.

The Nash’s attorney Todd Clemons says the brothers violated the law and are learning a tough lesson. “My clients, they made a mistake they were operating a business but they chose to violate the law. At the same time, I think they’re good and decent people and I think they’re being held accountable for their wrongdoing right now. But overall they’re good men who made a bad mistake and I think the future is still bright for them. They’re relatively young, I think they’re going to bounce back from this and move on, ” said Clemons.

It’s not clear at this point what action will be taken against food stamp recipients who misused their benefits. Federal officials encourage citizens to report fraud if they become aware of it. The number is 1-800-424-9121.

The U.S. Attorney’s news release can be found at the end of this story.

Copyright 2012 KPLC. All rights reserved.

The following is a news release from the U.S. Attorney:

United States Attorney Stephanie A. Finley announced today

that two brothers from Lake Charles, La. were sentenced on charges of conspiracy, wire

fraud and food stamp fraud following an investigation involving Goodfellas Grocery in

Lake Charles. U.S. District Judge Patricia Minaldi sentenced Craig Michael Nash, 39, to 60

months in prison for one count of Conspiracy to Commit Fraud and 78 months in prison

for one count of Wire Fraud, to run concurrent. Because the Judge ordered the sentences

to run concurrently, Craig Nash will serve six and a half years in federal prison, followed

by three years of supervised release. The Judge also ordered Craig Nash to pay

$1,784,135.51 in restitution to the United States Department of Agriculture, Food and

Nutrition Program. His brother, Hillary Nash, III, 40, who played a lesser role in the fraud,

was sentenced to six months in prison and three years of supervised release. Hillary Nash

was order to pay $62,515.86 in restitution. Craig Nash’s sister, Rosalyn Hilliard, 29, also

of Lake Charles, was previously sentenced on July 19, 2012, to three years probation for

Food Stamp Fraud and was ordered to pay $2,862.34 in restitution. Hilliard was

determined to have played a minor role in the fraud.

All of the defendants’ charges involved the Supplemental Nutrition Assistance

Program (SNAP). The program is the nation’s principal food assistance program which

enables low-income households to buy food by issuing monthly benefits in the form of an

Electronic Benefit Transfer (EBT) card redeemable for food at USDA authorized retail

stores. On January 28, 2004, Food and Nutrition Services authorized Craig Nash and

Goodfellas Tobacco to accept EBT food stamps after he applied to be an authorized retailer

to accept food stamp benefits.

After the store began participating in the program, investigators with the USDAOIG

learned of suspicious activity relating to the trafficking of SNAP benefits. The agency

opened an investigation on Goodfellas Grocery (formerly Goodfellas Tobacco) in 2009.

Agents from USDA-OIG and Alcohol Tobacco Control (ATC), as well as cooperating

witnesses, made multiple visits to Goodfellas Grocery and exchanged SNAP benefits for

cash, beer, liquor and cigarettes. Craig Nash continued to own and operate Goodfellas

Grocery during this time, and his sister, Rosalyn Hilliard, and brother Hillary Nash,

assisted Craig Nash at the check-out counter for two locations, Goodfellas and Goodfellas

II. Craig Nash knew his siblings were exchanging food stamps for cash and ineligible

items, and he was present during undercover transactions. During the undercover

transactions, Goodfellas purchased food stamp benefits and provided cash to recipients at

a discounted value. After the transaction, the full amount of benefits were redeemed by

Goodfellas from the Food Stamp Program and then deposited into a bank account in the

name of Craig Nash and Goodfellas. Goodfellas paid cash for SNAP benefits at the rate of

.50 cents on the dollar; therefore, Goodfellas profited by keeping 50% of the benefits. This

trafficking caused multiple fraudulent wire transfers of funds into Craig Nash’s bank

account.

According to government databases reviewed by law enforcement, from January

1, 2007, through January of 2011, Goodfellas Grocery completed or caused about 2,066

SNAP redemption transactions totaling $2,917,587.84 to be deposited into Goodfellas’ bank

account. The majority of the 2,066 EBT redemptions were fraudulent. A review of the bank

records, vendor invoicing and financial documents reveal that from January 2007 through

November 2010, Goodfellas’ expenditures for eligible food items were approximately

$153,779.89. Based on a review and analysis of Goodfellas Grocery transactions, the

amount of fraudulent funds received by Goodfellas Grocery and Craig Nash through food

stamp trafficking totaled at least $1,784,135.51, and the Court ordered this amount to be

paid in restitution. The investigation further reveal

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