United States Attorney's Office for the Western District of Virginia

01/14/2025 | Press release | Distributed by Public on 01/14/2025 13:45

Lynchburg Store Owner Arrested on Federal Food Stamp Fraud Charges

Press Release

Lynchburg Store Owner Arrested on Federal Food Stamp Fraud Charges

Tuesday, January 14, 2025
For Immediate Release
U.S. Attorney's Office, Western District of Virginia
Rajan Babbar Owns Taste of India in Lynchburg

LYNCHBURG, Va. - The owner of the Taste of India, a medium-sized grocery store in Lynchburg, Virginia, was arrested today on criminal charges related to his alleged fraud regarding the Supplemental Nutrition Assistance Program (SNAP), formerly known as the Food Stamp Program. SNAP was established by the United States Government to alleviate hunger and malnutrition among low- and middle-income families by increasing their food purchasing power and ability.

In a criminal complaint filed today, Rajan Babbar, 59, of Lynchburg, is charged with food stamp fraud and wire fraud. Babbar was arrested earlier today without incident.

According to court documents, in 2016 Babbar filed paperwork with the United States Department of Agriculture's (USDA) Food and Nutrition Service (FNS) for Taste of India to become a SNAP retailer. In approximately December 2016, FNS approved Babbar's application.

In approximately September 2018, FNS noticed that Taste of India had some unusual activity with its food stamp redemptions. Subsequently, FNS placed Taste of India on their "watch list" to further monitor the store's activities.

Scrutiny of Taste of India led to a civil investigation and penalty in 2020. On four out of five separate encounters between March 2019 and February 2020, undercover investigators with FNS made unauthorized purchases of ineligible items using SNAP EBT cards, primarily for cosmetic and hygiene products. Based on that, FNS determined that Taste of India was in violation of program rules. Babbar ultimately paid a $1,932 civil penalty in lieu of a six-month disqualification. However, he was allowed to continue to operate as a SNAP retailer.

According to the criminal complaint filed today, USDA-OIG agents began to review the food stamp redemptions for Taste of India and noticed the redemptions seemed unusually high for this type of store and location. The dollar amount of SNAP redemptions skyrocketed at Taste of India during a relatively short span. In January 2018, the store completed approximately $2,500 in monthly SNAP transactions; that figure was more than $30,000 by May 2021. By February 2023, Taste of India was redeeming more than $104,000 in SNAP funds. Throughout this period, Taste of India remained at the same location and in the same sized building.

USDA-OIG, in partnership with the Federal Bureau of Investigation and the Lynchburg Police Department, proceeded to conduct undercover operations at Taste of India in the spring of 2023. On three occasions between April and September 2023, an undercover source entered Taste of India and another store then operated by Babbar and attempted to exchange SNAP benefits for cash. On all three occasions, Babbar agreed to the exchange and provided cash to the undercover source. No product or merchandise was sold.

Acting U.S. Attorney Zachary T. Lee, Special Agent in Charge Charmeka Parker of the USDA-OIG, and Stanley M. Meador of the FBI's Richmond Division made the announcement today.

The USDA-OIG, FBI, and Lynchburg Police Department are investigating the case.

Assistant U.S. Attorney Lee Brett is prosecuting the case.

A criminal complaint is merely an allegation and all defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Updated January 14, 2025
Topic
Financial Fraud