The operators of a Santa Ana market are under investigation in connection with an alleged $2 million food stamp fraud scheme.
A warrant was served at Euclid Market, at the intersection of Euclid and McFadden Avenue, which is run by Jose Garcia Olivo and his daughter Johanna Garcia, and one was also sought for the mobile home they share in the 5000 block of McFadden.
Garcia Olivo and Garcia are being investigated by the Office of the Inspector General of the U.S. Department of Agriculture and the Internal Revenue Service’s Criminal Investigation unit, according to a search warrant affidavit filed on Friday in U.S. District Court in Santa Ana.
Probable cause exists that since 2013, Garcia and Garcia Olivo “have committed the offenses of food stamp fraud, conspiracy to defraud, theft of government property, mail fraud, wire fraud, engaging in monetary transactions in property derived from specified unlawful activity, tax evasion and filing a false tax return … ,” according to the affidavit.
The court papers allege that Garcia and Garcia Olivo paid “individuals in cash in exchange for charging those individuals Electronic Benefit Transfer cards instead of actually selling food.”
Garcia and Garcia Olivo allegedly paid the EBT cardholders less than what was charged to the cards, and pocketed the difference, according to the affidavit.
“For example, during an undercover operation … Garcia Olivo paid $250 in cash but charged $395 on the EBT card,” the affidavit states. “In other instances, Garcia actually used someone else’s EBT card at supermarkets and warehouse stores to make purchases for herself. Over the past several years, Garcia and Garcia Olivo have cheated the federal government out of approximately $2 million in EBT funds, including many months charging more than $100,000.”
They are also suspected of failing to accurately report hundreds of thousands of dollars of income from the scheme from 2013 through 2016.
The U.S. Attorney’s Office had no comment on the investigation.
The amounts and totals of the charges, which were unusual for a small convenience store, and the rapid depletion of cardholders’ monthly benefits aroused suspicions, according to the affidavit.
–City News Service
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