Posted on Fri, Nov. 6, 2009
The owner and two employees of a Westville convenience store pleaded guilty yesterday to defrauding the federal food stamp program, the U.S. Attorney's Office announced.
Mehal Mothon, 48, of Berlin, admitted illegally debiting more than $280,000 in cash at his Citgo Food Mart, 1010 Delsea Dr., using the electronic cards now employed to provide food assistance.
Mothon, who has owned the store since June 2006, is charged with conspiring to embezzle from the U.S. Department of Agriculture.
Mothon taught employees Lakhwinder Singh, 42, of Cherry Hill, and Palwinder Singh, 30, of Buena Vista Township, Atlantic County, how to work the scam. The two, who are cousins, also pleaded guilty to charges of conspiracy to embezzle, which carry a maximum sentence of five years in prison and a $250,000 fine. All three were arrested on April 1.
In the scheme, a customer would ask an employee to swipe his food stamp account card in return for cash. The employee would retain about half of the amount as a fee.
The crime is known as "trafficking" among USDA investigators. It is illegal to use the government-issued cards to collect cash. Investigators say they have uncovered similar illegal operations at two other South Jersey markets this year.
According to the criminal complaint, an undercover agent collected $20 cash using food debit cards on each of two trips to the store in August 2007. Employees swiped the undercover agent's cards for about $40 both times.
The cards also cannot be used to purchase noneligible items such as beer or cigarettes.
In December 2008, according to the criminal complaint, agents entered the store and administered a fake survey. While an agent was at the counter, a customer attempted to buy cigarettes with a card and Mothon "gestured" that he could not sell them, investigators reported.
Assistant U.S. Attorney Kevin Smith said investigators became suspicious of the food mart because it had barely enough items in stock to justify instances in which customers debited more than $100 from their food stamp cards.
"You're not buying a $20 piece of filet," he said.
Employees at two Camden markets also were arrested this year for defrauding the USDA of a total of nearly $800,000 in similar food-stamp card operations.
Contact staff writer Matthew Spolar at 856-779-3829 or mspolar@phillynews.com.
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