Shuja Alawdi, 40, of Buffalo, NY, is headed to federal prison for six months after being convicted of running a cash-for-food stamps racket at Bailey Food Mart, where he traded cash for benefits worth $124,406.
U.S. District Judge Richard J. Arcara handed down the sentence, ordering Alawdi to pay full restitution to the government. The conviction stems from a scheme that ran from July 2010 to August 2011, during which Alawdi and others systematically bought food stamp benefits at a discount from eligible recipients—cash exchanges strictly banned under federal law.
Alawdi co-ran the store located at 3209 Bailey Avenue, where the illegal transactions were carried out daily. Investigators say he knowingly profited by exchanging less-than-face-value cash for Electronic Benefit Transfer (EBT) credits, undermining a program meant to feed low-income families.
The case was prosecuted by Assistant U.S. Attorneys Stephanie Lamarque and Scott S. Allen, who laid out evidence showing a deliberate, organized operation. Retailers like Alawdi are permitted to accept food stamps for groceries—but never to exchange them for cash. He violated that rule repeatedly, stacking up losses to taxpayers.
The investigation was led by the USDA Office of Inspector General, under Special Agent-in-Charge William G. Squires Jr., with support from Homeland Security Investigations, led at the time by Acting Special Agent-in-Charge Kevin Kelly. Surveillance, transaction records, and witness statements built a damning case.
Acting U.S. Attorney James P. Kennedy, Jr. emphasized that fraud against public assistance programs won’t be tolerated. “Stealing from nutrition programs hits the most vulnerable,” he said. “We’re holding Alawdi accountable—six months in prison and a six-figure bill.”
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Key Facts
- State: New York
- Agency: DOJ USAO
- Category: Fraud & Financial Crimes
- Source: Official Source ↗
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