Crowdfunding is a popular way to raise money for a successful business venture or new product idea, usually accomplished through the Internet. (The concept involves obtaining a little bit of money from a lot of people.) Conversely, an article posted on Fox17Online.com tells about three brothers who ran a crowdfrauding scheme involving the illegal use of welfare benefits through their family-owned store. (The word crowdfrauding doesn’t exist, but it sounds like a good term for describing an illegal activity that takes government benefits from many in order to make a few wealthy.)
The story details that the three brothers allowed customers, who received government benefits, to exchange their federal funds for cash or items prohibited by the Supplemental Nutrition Assistance Program (SNAP) or the Special Supplemental Nutrition Program for Women, Infants and Children (WIC). To top that off, the brothers also allegedly applied for and received federal welfare benefits for themselves and their families. (Obviously, they thought there was plenty of government financial assistance to go around.)
Altogether, the brothers stole more than $1.2 Million through their family-owned business. (Not only did they receive a large sum of money from the illegal exchange of government benefits, but they also received financial assistance they did not qualify for or deserve because they neglected to report the income they earned through the market and from other sources on their welfare applications. Consequently, they received food and cash assistance plus Medicaid benefits.)
As a result of their illegal activities, the brothers and some of their family members were charged with multiple federal offenses. (In exchange for the trio entering guilty pleas for their roles in the scheme, the government agreed to dismiss the charges pending against their wives and other family members.)
The brothers received sentences of between 12 and 34 months in prison plus anywhere from two to three years of supervised release following the completion of their prison terms. All three were each required to pay more than $1.2 Million in restitution.
The idea behind crowdfunding is to gain monetary support through small financial contributions from many people who believe in the concept behind the project. In this case, the federal government was the sole financial supporter of many people who worked against the system designed to support those who truly need the assistance. (Obviously, the government was not a fan of the brothers’ business plan and it looks like the plug has been pulled on their illegal operation.)
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