U.S. Attorney Announces Indictments Returned In Local Federal Benefit Fraud Schemes; Several Charged With Stealing Millions From Government Funds Intended To Benefit Children And Poor Families
Memphis, Tenn. – Edward L. Stanton III, United States Attorney for the Western District of Tennessee, announced today that Ray Chism III, 42, and Remark Chism, 35, both of Memphis, Tennessee, were indicted by a federal grand jury yesterday for conspiracy to commit Supplemental Nutrition Assistance Program (SNAP) benefit fraud; SNAP benefit fraud; conspiracy to commit child care benefit fraud; theft of public money or property; and making false statements. Renita Little, a business associate of Ray Chism III, and Angelica Austin and Erica Pitchford, associates of Remark Chism, were charged as co-conspirators.
U.S. Attorney Stanton said, “As alleged, the defendants systematically and brazenly obtained government funds intended to benefit children and poor and low-income families – all to enrich themselves. Their schemes victimized taxpayers and the intended beneficiaries of the SNAP and Certificate programs. They will now have to answer for their alleged conduct and face severe consequences in a court of law.”
If convicted, Ray Chism III could face up to 95 years in prison and a fine of up to $4.5 million, and Remark Chism faces up to 135 years in prison and a fine of up to $6.25 million dollars.
Ray Chism III and Renita Little’s two-year scheme to commit SNAP and child care benefit fraud
The 18-count indictment against Ray Chism III and Renita Little alleges that beginning at least in October 2011 and continuing until December 2013, Ray Chism III used several businesses, including a daycare (Helping Hands Enrichment Center), a convenience store and car wash (Chism Express and Car Wash), and a family grocery store (the former Maxi Foods on South Third Street), to defraud public assistance programs.
The Supplemental Nutrition Assistance Program (formerly known as food stamps) is designed to help low- and middle-income families purchase food. According to the indictment, Ray Chism III would purchase SNAP benefits from recipients for less than face value and subsequently redeem the benefits through Maxi Foods for full value. SNAP is administered by the U.S. Department of Agriculture.
The indictment also alleges that Ray Chism III obtained undue payments under a program of the U.S. Department of Health and Human Services known as the Child Care Certificate Program. The Certificate Program helps needy families by subsidizing the cost of child care while parents work or attend school. According to the allegations, Chism would pay cash to parents in exchange for use of their child care certificates. Helping Hands would report the children were in attendance and receive reimbursement for care, even though the child named on the certificate did not actually attend. Renita Little, the one-time director of Helping Hands, is also charged with committing Certificate Program fraud. The loss to the Certificate Program through Helping Hands is estimated at more than $676,000 over a two-year time period.
Remark Chism, Angelica Austin, and Erica Pitchford’s two-year scheme to commit SNAP and child care benefit fraud
The 25-count indictment against Remark Chism, Angelica Austin and Erica Pitchford alleges that beginning in October 2011 and continuing until December 2013, Remark Chism used several businesses, including a daycare he owned (K.A.R.E. 3 Enrichment Center) and Maxi Foods, which he owned and operated, to defraud public assistance programs.
According to the indictment, Remark Chism would also purchase SNAP benefits from recipients for less than face value and subsequently redeem the benefits through Maxi Foods for full value. The indictment alleges that more than $1.9 million dollars in SNAP benefits were unlawfully redeemed for cash as part of Remark Chism’s scheme.
The indictment also alleges that Remark Chism obtained undue payments under the Child Care Certificate Program. According to the allegations, Chism would pay cash to parents in exchange for use of their child care certificates. K.A.R.E. would report the children were in attendance and receive reimbursement for care, even though the child named on the certificate did not actually attend. The loss to the Certificate Program through K.A.R.E. is estimated at more than $986,000 over a two-year time period.
Angelica Austin and Erica Pitchford are also charged with committing benefit program fraud. Each is alleged to have recruited individuals on Chism’s behalf to sell food benefits for cash at below face value. The women allegedly paid parents as part of the day care scheme as well.
Search warrants were executed in November 2013 at Helping Hands, Chism Express, Maxi Foods, and other locations. The investigation is still ongoing.
This investigation was conducted by the United States Department of Agriculture Office of the Inspector General; United States Secret Service; United States Marshals Service; Memphis Police Department Organized Crime Unit; and the Tennessee Department of Human Services. This case is being prosecuted for the government by Assistant United States Attorneys Larry Laurenzi and Debra Ireland.
The charges and allegations contained in indictments are merely accusations, and the defendants are considered innocent unless and until proven guilty.