Mastermind of $400,000 SNAP fraud sentenced to prison

Published: Nov. 3, 2015 at 8:41 PM CST|Updated: Nov. 3, 2015 at 9:16 PM CST
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MEMPHIS, TN (WMC) - A judge sentenced the mastermind behind a scheme that defrauded the government of $400,000 to 27 months in prison.

According to the indictment, Ray Chism III bought Supplemental Nutrition Assistance Program (SNAP) benefits, formerly known as Food Stamps, from recipients in exchange for cash. He did not pay the recipients what the SNAP benefits were worth, but then would redeem them for full monetary value.

Between October 2011 and December 2013, Chism recruited benefit recipients, then redeemed the benefits through Maxi Foods, a grocery store owned by Chism's brother, Remark Chism.

In October 2015, Remark Chism was sentenced to 37 months in prison for masterminding a separate $2.8 million scheme.

According to US Attorney Edward Stanton, Ray Chism also came up with a scheme to defraud the Child Care Certificate Program, which provides funding to help underprivileged families with child care cost.  That scheme took place during the same time frame as the SNAP benefit scheme.

Chism paid cash to parents who qualified for the program, then took their child care certificates. He would then falsely report the children's attendance to his daycare, Helping Hands Enrichment Center, and receive reimbursement for care.

In July 2015, Chism pleaded guilty to conspiracy to commit SNAP benefit fraud and conspiracy to commit child care benefit fraud.

In addition to the 27 month sentence, Chism must pay $200,000 in restitution.

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