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Former restaurant owner faces charges for fraudulent food stamps

Suspect accused of $7k in fraudulent purchases
Posted at 6:50 PM, May 08, 2017
and last updated 2017-05-09 06:41:29-04

A former Oconomowoc restaurant owner is in hot water after being accused of spending thousands of dollars in food stamps that weren't his.

The former owner of Buca All Day Eatery & Grill, Albert Islami, 38, faces five charges of unauthorized use of food stamps.

Another man, Adam Kuehn, 39, faces five charges of knowingly trafficking food stamps.

In a criminal complaint, police allege Kuehn was likely engaging in fraud with his EBT FoodShare card. The Inspector General at Wisconsin's Department of Health Services says they were tipped off to Kuehn's behavior with his Quest card.

"The recipient charged had requested 13 replacement cards over a  year's time," said Inspector General Tony Baize. "When we see a lot of replacements of FoodShare cards, it leads us to believe the person is selling their benefits."

According to the criminal complaint, they had seen large purchases at SAM's Club on Kuehn's account. The investigator in charge reviewed surveillance footage and say they saw a man, later identified as Islami, purchasing items totaling anywhere from $500 to close to $900 in several purchases.

The Inspector General says he made $6,991.90 in transactions from 2015 to 2016.

"Most food purchased appeared to be ingredients [Islami] used in his restaurant," Baize said. "Lots of large cans of tomato paste, tomato sauce, other ingredients you can find in items on the menu. These were large bulk items purchased at SAM's Club. So it's not something we would typically expect a FoodShare recipient to be purchasing. Typically, a one person household on FoodShare wouldn't need seven to eight gallons of tomato sauce every month."

Baize says he's seen this kind of practice before. In 2016, there were 1,382 FoodShare recipients suspended from the program for intentional fraud, compared to 203 in 2012.

He says the going rate for this kind of practice is 50 cents on the dollar. So people will pay cash to the card recipient in order to get the benefits of a FoodShare card worth twice as much.

"The unfortunate thing here is 50 cents on the dollar isn't a whole lot of money," Baize said. "Especially if this person qualifies for food sharing, they need the food. These cases are particularly troubling because this person's children aren't getting enough food to eat or that person doesn't actually need the benefits they're getting. If they can get by on $100 on cash and forgo the $200 a month for food, they may not need those benefits or they have some other issue they need cash for instead of the food."

Kuehn is accused of claiming benefits for children not living with him.

But Baize says it shouldn't just fall on the recipient's shoulders.

"I don't know the recipient's personal situation but certainly, if the state has identified this person as a person in need of food assistance, and the restaurant owner, somebody who knows better just sees this as a way to get cheap food for the restaurant," Baize said. "It's disturbing. If I'm a restaurant owner, I can go by $200 of groceries and hand over $100 in cash to a FoodShare recipient and I've cut my food costs in half for that month."

Islami's restaurant has been closed for the last year after fire damage forced them to shut down in May, 2016. If found guilty, he could face up to a $10,000 fine and three and a half years in prison if found guilty.

Baize says they have protocols in place to address fraud quicker like flagging any account that requests four replacement cards in a year. However, he says this situation is an extreme outlier.

"We don't see numbers get this high," Baize said. "What that probably means is this trafficking situation went on longer than we would have liked. We were monitoring the recipient's account after he requested more than four replacement cards but it took time for us to develop the case and gather surveillance and work with law enforcement to make sure we had a solid case for the District Attorney. Seven-thousand dollars  is high for a traffic case. We normally see $200 to $300, maybe $400 in these types of cases."

Even with the high number of cases in 2016 of fraud, the Office of the Inspector General says they are doing their best to find more cases of fraud like this.

"I do want the public to know we are here," Baize said. "We do investigate these cases all the time. We have a fraud hotline and portal on our website where people can report things they believe might be fraud. We investigate everything that comes in. We get 4,000 referrals each year for this type of fraud. I want the public to understand, while most FoodShare recipients are using the benefits as intended, there are a decent number of folks selling their FoodShare benefits for cash and we want to do what we can to stop that."

For more information on how to report fraud, go to the Office of the Inspector General website or call 1-800-HHS-TIPS.

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