In a sweeping federal indictment that strikes at the heart of America’s social safety net, the Department of Justice has charged six individuals—one of them a U.S. Department of Agriculture (USDA) employee—with orchestrating a massive, multi-state fraud scheme that siphoned $66 million from the Supplemental Nutrition Assistance Program (SNAP), commonly known as food stamps.
At the center of the operation is Michael Kehoe, alleged ringleader of a criminal network that, since 2019, exploited the SNAP system using a web of unauthorized Electronic Benefit Transfer (EBT) terminals and fraudulent USDA documentation. His network, according to the DOJ, embedded around 160 illicit EBT terminals in unlicensed retail stores across the country, including a notable concentration in Manhattan.
But what transformed this into a historic breach of public trust was the participation of a federal insider.
Arlasa Davis, an employee at the USDA, is accused of providing the very keys the group needed to carry out their fraud. According to federal investigators, Davis funneled confidential EBT numbers to an intermediary using her personal cell phone—a stunning violation of protocol. These numbers were then sold to Kehoe and his co-conspirators, who used them to process fraudulent SNAP transactions and extract millions in taxpayer funds intended for low-income American families.
In return for her assistance, Davis allegedly accepted cash bribes masked as innocuous “birthday gifts” and “flowers.” Her role reportedly enabled $36 million of the $66 million scam—making her betrayal not only pivotal, but devastating in scale.
The fraud didn’t stop with Davis and Kehoe. Also charged are Mohamad Nawafleh, Omar Alrawashdeh, Gamal Obaid, and Emad Alrawashdeh. Together, this crew processed roughly $30 million in illegal transactions and submitted around 200 fraudulent applications to the USDA—bolstered by fake documentation to secure authorization for the EBT terminals.
Nawafleh’s case takes an international twist: he fled the United States while out on bail and is now believed to be hiding in Jordan. He faces an additional charge of failure to appear in court.
U.S. Attorney Perry Carbone condemned the operation as a betrayal of the most vulnerable. “This fraud was made possible when USDA employee Arlasa Davis betrayed the public trust by selling confidential government information to the very criminals she was supposed to catch,” he stated. “Their actions undermined a program that vulnerable New Yorkers depend on for basic nutrition.”
The charges brought include conspiracy to steal and misappropriate government funds, theft of USDA benefits, bribery, and wire fraud. If convicted, the defendants face decades behind bars and restitution orders that could span the rest of their lives.