Bill Mercer, United States Attorney for the District of Montana, announced today that during a federal court session in Helena, on March 17, 2009, before Senior U.S. District Judge Charles C. Lovell, KENDY MICHELLE CARPENTER, a 31-year-old resident of Helena, appeared for sentencing. CARPENTER was sentenced to a term of:

• Prison: 24 months

• Special Assessment: $400

• Restitution: $9,542.26

• Supervised Release: 3 years

CARPENTER was sentenced in connection with his guilty plea to violation of the False Claims Act, federal student loan fraud, food stamp assistance fraud and bankruptcy fraud.

In an Offer of Proof filed by the United States, the government stated it would have proved at trial the following:

In 2005, CARPENTER was operating a child care business out of her home. At that time, she had two children by virtue of her marriage to D.M., a daughter born in 2004, and a son born in 2003. CARPENTER also had two children by virtue of a relationship with K.R., a daughter born in 1995, and a son born in 1994.

In April 2005, CARPENTER applied for and received a $1,000 grant from the Best Beginnings Scholarship Program to build a fence around her yard, thereby enhancing the safety of the area where she had children receiving child care services. She then represented that she had used the money to build the fence in her yard and submitted an invoice reflecting the purchase of materials, when she knew the fence had not been built, the supplies not purchased, and that the receipt was fraudulent.

On October 10, 2005, the Director of the Adult and Child Care Food Program performed a records search for duplicate children claimed for program benefits and produced a Duplicate Children Claimed report. The report disclosed that in September 2005, CARPENTER, then using the name Morton-Carpenter, had claimed CACFP benefits for a child that had also been claimed by another service provider. This finding triggered a parent survey and it was determined that several other children claimed by CARPENTER to have been cared for by her during the summer of 2005 had not, in fact, been in her care, even though she had claimed and received CACFP benefits on the basis of her representations.

During this same time, late September 2005, a social worker disclosed that a child who had been eligible for BBSP benefits had not been in CARPENTER'S care since June 2005. Efforts to verify whether CARPENTER had been eligible for any reimbursement from that program failed when CARPENTER failed to disclose her records. ChildCare Partnerships, Inc., the non-profit organization that administers the BBSP in that area, attempted to recoup the overpayment but were unsuccessful. CARPENTER had billed the organization for the care of three children in 2003 for days when she was on vacation or otherwise not operating her child care business. The organization had been able to get reimbursement in that instance by deducting a portion of future amounts.

On July 31, 2006, CARPENTER completed a Department of Public Health and Human Services application for welfare benefits (Food Stamps and Medicaid). In that application, CARPENTER disclosed the $1,052 she received in monthly child support from K.R., but failed or refused to disclose the $1,200 she received each month from D.M. The non-disclosure was material because had it been listed, CARPENTER would have been ineligible for welfare benefits.

In October 2006, CARPENTER and D.M. declared bankruptcy. In her petitions and schedules, CARPENTER made false statements and willful omissions. CARPENTER failed to report unearned income for the calendar years 2004 and 2005 in the form of child support payments, government payments from the Child/Adult Care Food Program, and government payments from the Best Beginnings Scholarship Program.

In November 2006, CARPENTER completed a six month status report wherein she made the same fraudulent omission; claiming the $1,052 in child support from one source and concealing the $1,200 from the other.

On January 2, 2007, CARPENTER began a job with the Montana State Department of Public Health and Human Services (DPHHS) as an insurance claims examiner. She continued to receive welfare benefits and did not disclose, as she was required to do, this change of circumstances which would have affected her continued entitlement to food stamps and medicaid. When she failed to appear for her six month re-certification interview, her benefits were suspended and her file closed on June 1, 2007.

One month later, on July 11, 2007, CARPENTER reapplied for welfare benefits. In this application she claimed that her only income was child support in the amount of $300 from K.R. and $200 from D.M. CARPENTER claimed a new household member, husband J.M., and claimed that J.M. contributed nothing financially to the household income. This application fraudulently represented the true amount of child support she was getting from D.M. and K.R., failed to disclose her income from the state, and failed to disclose the substantial income being brought to the household by J.M., who was then employed in logging.

To bolster her false statements, CARPENTER fabricated and forged two letters - one purporting to be authored by K.R. and one purporting to be authored by D.M. - indicating that K.R. and D.M. were paying $300 and $200, respectively, each month in child support.

Because there is no parole in the federal system, the "truth in sentencing" guidelines mandate that CARPENTER will likely serve all of the time imposed by the court. In the federal system, CARPENTER does have the opportunity to earn a sentence reduction for "good behavior." However, this reduction will not exceed 15% of the overall sentence.Assistant U.S. Attorney Carl E. Rostad prosecuted the case for the United States.The investigation was conducted by the United States Department of Agriculture, Office of Inspector General, Great Plains Region as part of the "Trick for Treat Project."

The "Trick for Treat Project" is a cooperative initiative of the U.S. Department of Agriculture's Office of Inspector General and the U.S. Attorney's Office which targets fraud in food stamp and related programs, particularly with regard to lying about the amount of household income, the number of household members, or other factors which affect eligibility for need-based benefits. Through vigorous prosecution of offenders, the agencies seek to protect the integrity of the Food Stamp Program and insure that such benefits go only to those qualified and entitled to receive them. To report all suspected welfare fraud, please call 1-800-424-9121.

 

 

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