BALTIMORE, MD – Muhammad Sarmad, 41, of Nottingham, Maryland, is headed to federal prison after being sentenced to 18 months for a brazen scheme to defraud the Supplemental Nutrition Assistance Program (SNAP), formerly known as food stamps. U.S. District Judge Richard D. Bennett handed down the sentence on March 27, 2017, alongside an order for Sarmad to pay a staggering $3,550,662 in restitution.
The case, brought by the U.S. Attorney for the District of Maryland Rod J. Rosenstein, in conjunction with the USDA Office of Inspector General and the FBI, exposed a calculated effort to illegally exchange food stamp benefits for cold, hard cash. Sarmad and his co-conspirators, including Mohammad Irfan, operated a network of stores – New Sherwood Market, Martin Mart, Rosedale Mart, and M&A Mart – using them as hubs for the illicit operation.
According to court documents, from October 2010 through at least July 2016, Sarmad, Irfan, and their associates routinely paid customers roughly half the value of their EBT benefits in cash for ‘food’ that never materialized. They masked the illegal transactions through a variety of methods, including splitting payments across multiple transactions and processing them at different store locations to evade detection. The M&A Mart, not authorized to accept SNAP, served as a cash distribution point, with transactions run through other stores.
“The food stamp program can be exploited by criminals like Muhammad Sarmad, who take advantage of the fact that the Department of Agriculture trusts retailers to actually provide food in return for taxpayer money,” Rosenstein stated bluntly. The SNAP program, funded by the USDA and administered with state agencies, provides crucial support for low-income individuals to access nutritious food via EBT cards – a system easily abused, as this case demonstrates. Retailers are supposed to use point-of-sale terminals to verify benefits and receive electronic reimbursement *only* for legitimate food purchases.
Sarmad admitted to obtaining over $3.5 million in fraudulent payments between October 2010 and August 2016. He and his crew were fully aware of the program’s regulations, including the prohibition of exchanging benefits for cash or ineligible items. This wasn’t a mistake; it was a deliberate, large-scale theft from a program designed to feed those in need. Sarmad will also serve three years of supervised release following his prison term.
This conviction is part of a larger crackdown on SNAP fraud in the Baltimore area. Nine other retail operators have already pleaded guilty to similar schemes and await sentencing, while three more defendants are scheduled to face trial later this year. Federal agents continue to investigate, signaling a continued effort to root out those who prey on a vital social safety net. Special Agent in Charge William G. Squires, Jr. of the USDA OIG, and Special Agent in Charge Gordon B. Johnson of the FBI, oversaw the investigation.
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Key Facts
- State: Maryland
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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