Date: April 29, 2020
RALEIGH, N.C. – A Warsaw man was sentenced today to 48 months in prison for SNAP fraud and conspiracy to commit money laundering charges. He was also ordered to pay restitution in the amount of $464,385.60 and to forfeit criminal proceeds and property used in the crimes.
According to court documents, Fernan Sanchez previously pled guilty to making material false statements in connection with the on-going federal crop insurance fraud investigations in Eastern North Carolina. On April 9, 2010, the Court granted the government's motion for a departure based on substantial assistance and sentenced Sanchez to 5 years' probation.
Sanchez's 2010 felony conviction made him ineligible to participate in SNAP and he was permanently disbarred from the program. Notwithstanding his debarment, Sanchez recruited another person who, at Sanchez's direction, created a business entity known as Selena's Mexican Bakery & Store, opened a bank account in the name of Selena's Mexican Products, and submitted an electronic SNAP vendor application that contained false and misleading information. Based on the application, the co-conspirator received authorization to be a SNAP vendor in August 2013. The co-conspirator opened up a bank account, listing Sanchez on the account.
From August 30, 2013, through September 24, 2017, Selena's Mexican Bakery & Store received approximately $464,385.60 in SNAP benefits. During that period, Sanchez trafficked SNAP EBT benefits, allowing individuals to exchange benefits for cash or ineligible purchases.
Sanchez and/or another person, through Selena's Mexican Products, also caused the transfer of $464,385.60 SNAP funds to Selena's Mexican Products business account at First Bank. Sanchez transferred a portion of the money to an account controlled exclusively by him. He withdrew or otherwise spent the remaining SNAP funds in the Selena's Mexican Products business account.
The Internal Revenue Service - Criminal Investigations, and the United States Department of Agriculture - Office of Inspector General conducted the investigation in this matter. The Warsaw Police Department assisted in the investigation. Assistant U.S. Attorney Banumathi Rangarajan is prosecuting the case.