ROCKFORD — Four Rockford residents were arrested on federal charges of food stamp fraud and wire fraud.
The residents are accused of accepting Supplemental Nutrition Assistance Program benefits in exchange for cash, the Rockford Register Star reported. All four people have pleaded not guilty.
If convicted, they could face up to 20 years in prison and a fine of up to $250,000 for each wire fraud count. Each count for redemption of the stamps for cash has a penalty of up to five years in prison and a fine up to $20,000.
Federal authorities raided and seized paperwork from several businesses Wednesday.
John G. McKenzie is the assistant U.S. attorney in Rockford. Citing the ongoing investigation, he declined to comment on whether other businesses were involved.
SNAP provides nutrition aid to lower-income residents and families on their Illinois Link cards. Recipients use their benefits by presenting their Link card to a retailer authorized by the U.S. Department of Agriculture to participate in the program.
The way such frauds usually work is that a person with a SNAP card would get $50 in cash from the business, while the business would charge $100 against the LINK card, giving the business $50.
John G. McKenzie, assistant U.S. Attorney in Rockford, said the investigation is ongoing and wouldn’t comment if additional businesses are involved.
Rockford Ald. Karen Elyea said the arrests can only benefit the neighborhood.
“It’s taking the money supply out of what’s fueling the drug dealers,” she said. “The problem with the crime in the neighborhood is it is being generated by people who do not live in the neighborhood, people coming from all over the place and getting cash and buying drugs.”