Neither my Daughter nor I had any personal jewelry with us or on our person, such as a watch, necklace, with the exception of a gold ring, which had on her left hand, which she refused to pawn for the bail. I do not own a gold watch and have never owned a gold watch to my knowledge. Any information to the effect that I had a gold watch in my possession is completely

untrue.

Neither me nor my children returned to Dillon after were directed in Interstate Highway 95, by this socalled Bondsman. I do not know if he owned a store or not, as I did not actually see it.

My Sister-in-Law

Turneville, South Carolina, and my Cousin Olanta, can both be contacted and will confirm the information related by me in this statement as to my conversation about paying my fine with food coupons.

Upon my arrival in Fort Myers, Florida, some days later, I made a formal complaint to personnel of the Food and Nutrition Service, who advised that they would forward the information to the proper authorities.

I might mention also that the State Trooper advised me, prior to leaving Interstate 95, that my fine would be $20 and I told him that all I had was food stamps and $2.45 in cash.

UTICA, N.Y.

(Case No. NY-2791-61)

This is a continuing investigation of an intitial investigation conducted to determine if also

known as

d/b/a

424 South Street, Utica, N. Y. was accepting food stamps while disqualified fom the Food Stamp Program (FSP). The purpose of this part of the investigation was to interview complainants regarding violations by the subject. Reporting Agent made six visits to

March 14 through April 3, 1974. On all six visits, a

were purchased from

and

A total of 22 ineligible items were sold for food beer and cigarettes on several occasions.

during the period total of 45 items for food stamps. stamps, including

On April 4, 1974, two of the food stamps used to purchase merchandise by Agent at were recovered from the

The coupons were serial numbers CO2561862A and CO2561863A. Copies of the coupons are attached at Exhibit 8. The stamps had been redeemed under the retailer redemption authorization issued to The coupons were stamped on the back with the name of that store and were redeemed with a retailer redemption certificate signed by is the mother of ___

owner.

and wife of

III. TRAFFICKING IN AUTHORIZATIONS TO PURCHASE

FOOD COUPONS

SYRACUSE, N. Y.-TRAFFICKING IN AUTHORIZATIONS
TO PURCHASE FOOD COUPONS

(Case No. N-2748-35)

From March 1971 to May 1972, a grocery store owner acted as proxy for approximately 75 food stamp recipients in approximately 255 transactions. During these transactions he purchased $14,563 worth of food coupons for a cash requirement of $10,336 involving bonus coupons valued at $4,227.

Two food stamp recipients stated that they sold their Authorization to Purchase Food Coupons (ATPs) to One of these recipients, sold her ATPs worth $162 in coupons per month to for four months from February 1972 through May 1972.

One recipient,

to

stated that he gave his wife's ATPS five times and received a few dollars for each ATP. His wife would also get about $15 worth of food and groceries for each ATP.

Three recipients stated that extended them credit for groceries until they later purchased their food coupons. After the recipients received their food coupons, they settled their charge accounts with

in a signed statement, stated that he acted as proxy and purchased food stamps for approximately seventy-five (75) individuals in 100 transactions from March 1971 to July 1972. During this period he also was given other ATPs by with which to purchase food stamps. He was under the impression

was buying food coupons for his customers.

Two Investigative Aides, in two shopping visits to subject store, purchased nine ineligible items for food coupons. Total items purchased was 21 of which only 12 were eligible items.

An Authorization to Purchase (ATP) is the means through which an approved household purchases food coupons at a contracting (selling) bank. These food coupons are the proper media for use by the household in purchasing eligible foods. Retailers are entitled to redeem only those coupons for which they have given eligible food items. A retailer who takes an ATP (which is not transferable) for which he purportedly gives a portion of the value of the bonus (the Government's contribution to an approved household to raise its nutritional level) has worked a defeat of the basic intent and purpose of the Food Stamp Program. When the retailer, substituting himself in the place of the approved recipient through a proxy device, converts the ATP into the total allotted coupons and redeems (deposits)

all of them he has redeemed coupons for which he has not given eligible food items in exchange. In effect, the retailer has used for his own purposes food coupons intended for the exclusive use of approved households in increasing their food purchasing power.

CHICAGO, ILL.-FRAUD AND OTHER IRREGULARITIES IN THE EMERGENCY FOOD STAMP ISSUANCE PROGRAM DURING MAY AND JUNE 1970

(Case No. C--2745-312)

The initiation of new procedures for the emergency issuance of food stamps in Illinois requiring the preparation of Emergency Authorization Card for the Purchase of Food Stamps (Emergency ATP cards) at the county level for the first time coincided with thousands of Teamster Union members on strike becoming eligible for emergency food stamp issuance in Cook County. The Department of Public Aid was unprepared and understaffed to manage the program under these

circumstances.

In an attempt to cope with the demands placed on it, the Department established temporary certification offices in the Union halls and other community centers throughout the county and was forced to staff these offices largely with inexperienced Department employees drafted from other departments, temporary clerical help hired by the Unions, and volunteers recruited from the ranks of the applicants. Major weaknesses in the distribution, safeguarding, and accounting procedures for blank Emergency ATP cards permitted an unknown number (at least 760) of blank Emergency ATP cards to be stolen or fraudulently obtained by many individuals. These individuals were able to prepare the cards in acceptable form for negotiation at currency exchanges for food stamps or to sell the cards to others who negotiated the cards at currency exchanges for food stamps. Numerous other individuals, upon learning about the simplified procedures for making applications for emergency food stamp issuance and the lax identification requirements at temporary certification offices, made one or more applications containing false statements regarding number of people eating together, assets, or income. Many applicants also used false names, addresses, and employers.

A total of 730 Emergency ATP cards were stolen or fraudulently obtained during May and June 1970 and negotiated, permitting a total of $143,889 in USDA food stamps to be issued against these cards for total cash payments of $2,318.50.

Another 30 Emergency ATP cards stolen or fraudulently obtained were recovered by OIG and other agencies prior to their negotiation for food stamps. These 30 cards, had they been negotiated, would have permitted a total of an additional $5,876 in USDA food stamps to be issued for a total cash outlay of $89.50.

Another 616 Emergency ATP cards negotiated during May and June 1970 have been categorized as questionable and will be referred to the Illinois Department of Public Aid to determine the validity of applications which authorized the issuance of these cards.

Nine related reports and one supplemental report have been submitted which concern specific individuals and acts to theft, fraud, and

trafficking in food stamps. Also, an OIG audit was conducted as a result of information developed during the investigations which demonstrated the need for immediate corrective action on the part of management. This report is not concerned with individuals or specific acts, but is designed to show the total financial loss suffered; and to show the causes of why and how the fraud was perpetrated and the corrective measures taken.

IV. FRAUDULENT ACQUISITION OF FOOD STAMPS

(INDIVIDUAL)

IOWA CITY, IOWA-FOOD STAMP PROGRAM PARTICIPATION IRREGULARITIES (SUPPLEMENTAL No. 2)

(Case No. KC 2749–19)

Investigation disclosed that

had income that was not

reported or counted in his certifications for food coupons, and that he overstated his household size. By so doing, received $788 in bonus coupons to which he was not entitled.

The

household income was substantially in the form of loans, grants, and work-study payments from the University of

Iowa.

The original investigation disclosed that failed to report to the County Office all of his income, and on some of his applications for food coupons overstated the number of persons in his household, which resulted in his receiving bonus coupons to which he was not entitled.

all of Albuquerque,

his wife and brother, operated as food stamp recipients throughout the State of New Mexico. They applied, were certified and received, during the period October 1970 through March 1971, food stamps valued at $12,047 for $235.25 in cash at 14 different Issuing Offices. They accomplished this through false and unverified household and address certifications in their Applications for food stamps as Non-Financial Assistance Householders. The value of the food stamps acquired by equaled $1,710; by Mrs. and by $4,212. Except for a few traced to an authorized retailer, the ultimate disposition of these stamps could not be established.

$1,584; by

An informant supplied information that:

$168;

The group of persons who are obtaining food stamps at some Issuing Offices in the State are being led by His wife, Mrs. also gets stamps at these places. They drive a red Chevrolet El Camino pickup truck. They have taken him on a few of the trips, but he does not recall how many stamps he got or where he obtained them. He cannot furnish information as to where the ring members will be going, only where they have been, after they get back into town. He knows that they have been to Santa Fe and Espanola, as well as Taos and Las Vegas, New Mexico. Which ring members obtained stamps in which towns he cannot say. Another ring member, who has done over 10 years in prison for killing a man and is also a narcotics user, is a member of the ring who is not trusted too well.

60-358-76-5