Waterbury Store Operators Charged with Food Stamp Fraud

Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that TALLAT MAHMOOD, 63, of Waterbury, RAUL CARLOS MONARCA, 40, of Waterbury, and TAHIR SHAHZAD, 32 of Harrison, N.Y., have been arrested on criminal complaints charging them with federal food stamp fraud and illegally trafficking in food stamp benefits at a retail food store in Waterbury.  MAHMOOD and MONARCA were arrested by federal law enforcement agents on August 18 and SHAHZAD surrendered to authorities yesterday afternoon.

The federal food stamp program, also known as the Supplemental Nutrition and Assistance Program (SNAP), is administered by the U.S. Department of Agriculture’s Food and Nutrition Service and utilizes federal tax dollars to subsidize low-income households to provide them with the opportunity to achieve a more nutritious diet by increasing their food-purchasing power.  SNAP recipients purchase eligible food items at retail food stores through the use of an Electronic Benefits Transfer (EBT) card, and SNAP benefits may be accepted by authorized retailers only in exchange for eligible items.  Items such as alcoholic beverages, cigarettes, paper goods and soaps are not eligible for purchase with food stamp benefits, and it is a violation of the rules and regulations governing the food stamp program to allow benefits to be used to purchase ineligible items.  SNAP benefits may not lawfully be exchanged for cash under any circumstances.  The program is designed so that the total amount of each purchase is electronically transferred to the retailer’s designated bank account.       

According to the criminal complaints, MAHMOOD, MONARCA and SHAHZAD worked at WB Trade Fair Grocery, located at 43 Willow Street in Waterbury.  From November 2014 until June 2016, MAHMOOD, MONARCA and SHAHZAD illegally allowed customers to redeem their food stamp benefits for cash and other ineligible items, including cigarettes, glass pipes, bongs and hookahs.  The store operators often charged a premium for these illegal transactions.

According to the complaints, given the stock of eligible food items at the store, the number of registers, and the customer amenities, it is estimated that WB Trade Fair Grocery could lawfully redeem at most between $120,000 to $240,000 per year in food stamp benefits.  However, during this approximately 18-month period, food stamp redemptions at the store totaled approximately $3.2 million.

Following their arrests, MAHMOOD, MONARCA and SHAHZAD appeared before U.S. Magistrate Judge Sarah A. L. Merriam in New Haven.  MAHMOOD and SHAHZAD were ordered to surrender their passports and were released on bond.  MONARCA was ordered detained.

If convicted, the defendants each face a maximum term of imprisonment of five years, a fine of up to $250,000 and full restitution to the government.

U.S. Attorney Daly stressed that a complaint is only a charge and is not evidence of guilt. Charges are only allegations, and each defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.

This matter is being investigated by the U.S. Department of Agriculture, Office of Inspector General, and is being prosecuted by Assistant U.S. Attorneys Anastasia E. King and Neeraj N. Patel.