Feb. 16, 2011

TWO CHARGED IN FOOD-STAMP FRAUD CASE ALLEGEDLY OCCURRING NEAR U.S. COURTHOUSE

WICHITA – Two Wichita residents have been arrested and charged with conspiracy to exchange food stamp benefits for cash, some arising out of incidents across the street from the federal courthouse, U.S. Attorney Barry Grissom announced.

The two, Ahmed Ajami Al-Maleki, 40, and Wally Mikhael Gaggo, 48, both of Wichita, allegedly conspired to defraud the U.S. Department of Agriculture by giving cash to Supplemental Nutrition Assistance Program (SNAP) recipients in exchange for their benefits, according to a criminal complaint unsealed in the case Wednesday. Both men were scheduled to make a first appearance before a United States magistrate judge at 1:30 p.m. Wednesday.

SNAP benefits are most commonly known as “food stamps,” although they now are distributed by the use of EFT cards provided to recipients. The benefits are to be used only for certain food items authorized by SNAP.

The complaint identifies alleged transactions occurring at 3rd and Broadway and 3rd and Market, across the street from the federal courthouse here. The complaint alleges that defendant Gaggo obtained cards and PIN numbers from recipients standing on the street outside the Drop-In Center at 353 N. Market, ran them through a SNAP terminal used by Al-Maleki at his Kansas Food Market store at 2600 North Arkansas, then brought cash back to the recipients. Most transactions were for 50 cents on the dollar, Grissom said, meaning that for $300 worth of food stamp benefits, the recipient received $150 cash and Al-Maleki’s business account was credited with $300 by the USDA. The SNAP program in Kansas is administered by the State of Kansas Department of Social and Rehabilitation Services.

Most of the people who congregate outside the Drop-In center are unemployed, and many are among Wichita’s homeless, Grissom said.

“This is part of an ongoing investigation into food stamp fraud in the Wichita area being led by the USDA assisted by the state and several federal law enforcement agencies,” Grissom said. “Additional persons are likely to be charged. I will have more to say about it if and when indictments are returned in the case.”

If convicted, both men face up to five years in prison and a fine of up to $250,000. As in any criminal case, the defendants are presumed innocent until and unless proven guilty. The case is being investigated by the USDA Office of Inspector General with the assistance of the U.S. Marshals Service, ICE Homeland Security Investigations, SRS and the Wichita Police Department. Assistant U.S. Attorney Brent Anderson is prosecuting the case.