The owner of a Southside Birmingham grocery store, who was among those arrested last week in a state food stamp fraud roundup, pleaded guilty Monday to unrelated charges of federal food stamp and tax fraud totaling more than $1.6 million.
Sufyan Hazem Saleh, 33, of Birmingham, pleaded guilty before U.S. District Judge R. David Proctor to one count of tax fraud and one count of food stamp fraud.
Under a plea agreement with the U.S. Attorney's Office, Saleh agrees to pay restitution of $498,470 to the IRS and $1,125,772 to the U.S. Department of Agriculture, which administers the food stamp program.
Saleh also has agreed to forfeit another $375,220 to the government.
In exchange for his guilty plea, prosecutors are dismissing two other charges and a sentence at the low end of the federal sentencing guideline range, which will be determined at sentencing.
Saleh's attorney, Clayton Tartt, declined comment after Monday's change of plea hearing.
Saleh is to be sentenced Sept. 10, according to an announcement by U.S. Attorney Joyce White Vance, U.S. Department of Agriculture Office of Inspector General, Investigations, Special Agent in Charge Karen Citizen-Wilcox, and Internal Revenue Service Criminal Investigation Special Agent in Charge Veronica Hyman-Pillot.
Saleh owns the now shuttered City Supermarket at 1531 13th Place South, a convenience grocery store that was authorized by USDA to accept food stamp benefits, according to the statement that cites court documents. A federal grand jury indicted Saleh in August 2014.
People who receive SNAP program benefits, get them from the USDA on an electronic benefit transfer (EBT) cards, which function like debit cards. Saleh pleaded guilty to redeeming EBT SNAP benefits for cash, which is prohibited, between January 2010 and December 2011, according to the statement.
Of the nearly $1.9 million City Supermarket redeemed in EBT SNAP benefits during that period, the USDA estimated that $1,125,772 was food stamp fraud, according to the statement.
One or more cooperating witnesses for the USDA Office of Inspector General were used on multiple occasions in late 2009 and in 2010 to redeem EBT cards for cash, according to the plea agreement.
Saleh, a naturalized citizen who was raised in Oakland Calif., also pleaded guilty to tax fraud for under reporting to the IRS his 2009 and 2010 income received from redeeming SNAP benefits. Saleh did not report about $1.6 million in income from food stamp redemption for the two tax years, resulting in a tax loss of about $498,470, according to his plea.
Saleh recently was arrested last week on unrelated state charges of food stamp fraud along with 16 others in Operation T-bone, a countywide sweep that targeted those who have allegedly cheated the food stamp system of hundreds of thousands of dollars. Some of the profits were sent to Yemen, prosecutors said.
Saleh faces 11 charges of EBT fraud in the state case. He was being held in the Jefferson County Jail on Monday morning.
Saleh on Monday morning and many of the 17 charged in last week's roundup appeared before Jefferson County District Court Judge Shelly Watkins for a hearing to see whether they needed attorneys and other issues. In at least one case the judge lowered the bond to $20,000 per case for one person facing 23 counts of food stamp fraud.
Assistant U.S. Attorney Pat Meadows, who is prosecuting the federal case, said any monies sent by Saleh to Yemen were sent to his family.
In the round up last week prosecutors said that a number of convenience store owners bought EBT cards for about half of what they are worth. In return, the person who sold their EBT card now had cash to buy items not allowed to be purchased under the government system, such as alcohol, tobacco and drugs.
The store owners and managers then would then go to a wholesaler where they would buy goods and bring them back to their stores to sell at a further inflated price.
Presiding Jefferson County Circuit Court Judge Houston Brown also has set hearings for Thursday on Jefferson County District Attorney requests for forfeiture of property, equipment and bank accounts of those charged in the fraud.