Federal investigators uncovered $8.4 million in food stamp fraud at an Ohio meat delivery business, according to recently unsealed federal court filings.
Investigators filed a search warrant application in the U.S. District Court of the Southern District of Ohio to investigate Ohio Direct Distributors (ODD), alleging the business received $8.4 million from fraudulent Supplemental Nutrition Assistance Program (SNAP) transactions between August 2011 and September 2017.
The affidavit states the listed owner of the business, Kaitlin Koher, and five others are “targets” of the federal investigation.
Federal investigators accuse ODD of illegally processing SNAP recipients’ benefits by trading the benefits for prepaid gift cards and redeeming them with the government at a much higher value.
The business “oftentimes completed transactions without the individual recipient’s knowledge or consent,” the court filings state.
Investigators say ODD also tried to threaten recipients with “prosecution” if they canceled their SNAP benefits.
“Recipients were warned of possible state prosecution if they canceled their SNAP EBT card, or allowed an inadequate balance to occur,” according to court papers.
Court documents state that investigators used confidential informants and undercover law enforcement to uncover the fraud.
The Canton Rep reported that the business operated out of a garage-like business with no signs indicating its presence. The business has been in operation since July 1, 2010, according to its Better Business Bureau listing.
But when reporters from News 5 Cleveland visited the site of the business, it looked abandoned.
Food stamp fraud can carry serious penalties, including several years behind bars and millions of dollars in fines to the federal government. A woman in Kentucky convicted of carrying out $409,000 food stamp fraud received a 66-month prison sentence.