Archive for Monday, June 13, 2011

Wichita man admits conspiracy in food program fraud

June 13, 2011

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— A Wichita man accused of scouring homeless shelters for poor people willing to sell their food program benefits for cash has admitted scheming with the owners of two small grocery stores to defraud the federal government.

Wally Gaggo pleaded guilty Monday to two counts of conspiracy to defraud the U.S. Department of Agriculture. Prosecutors say the schemes cost the government more than $580,000. The U.S. attorney's office has charged a total 13 people in two separate indictments.

Prosecutors say the owners of Kansas Food Market and Alnoor Grocery and Biryani House typically paid people half of the value of their food stamps and pocketed the difference.

Gaggo was the so-called runner for both stores. He collected a 10 percent "finder's fee" for each transaction.

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