Federal agents say they executed criminal search warrants at two Twin Cities stores on Thursday as part of an investigation into $2.1 million of Supplemental Nutrition Assistance Program fraud.
Twenty other stores were part of the investigation and are suspected of violating the SNAP program; they were issued administrative charging letters, according to the U.S. Department of Agriculture.
The probe — called “Operation Cold SNAP” — started in February. The USDA says that as part of the schemes, retailers would exchange taxpayer-funded SNAP benefits for cash or other items.
“They bring the card into the store and instead of buying an eligible food item, which is what SNAP is for, they exchange the benefits of that card for cash, for money. And then the retailer will take that money on the card, spend it,” USDA Inspector General John Walk said.
In the past, the USDA has said the…
Investment fraud targets the human desire for financial growth by promising high returns with “low to no risk.”
- Ponzi Schemes: Named after Charles Ponzi, these schemes pay “returns” to earlier investors using the capital brought in by newer investors. There is no actual underlying business; the system collapses when new recruitment slows down.
- Pyramid Schemes: Similar to Ponzi schemes, but participants are usually required to sell a product or service. The primary “profit” comes from the recruitment fees of new members rather than actual product sales.
- Pump and Dump: Fraudsters spread false, positive rumors about a cheap stock (the “pump”) to drive up the price. Once the price peaks, they sell their shares (the “dump”), leaving other investors with worthless stock.