As the White House expands its “war on fraud,” the Justice Department announced criminal charges in recent days against a new symbol of that battle — a food truck in Santa Ana, Calif.
Soriano Produce, a weathered white food truck advertising ice cream treats as well as fruits and vegetables, drew the attention of undercover agents at Immigration and Customs Enforcement for what investigators said was a startlingly high number of food stamp transactions for such a small business.
The case against the food truck owner, Esmeralda Soriano, is an example of the Trump administration’s push to show that “no fraud is small enough or big enough to look away from,” as Vice President JD Vance said in a speech in April.
The new emphasis on small-dollar fraud comes as the administration has issued pardons and commutations to white-collar convicts, pulled back from pursuing criminal cases against multinational corporations and dropped high-profile charges against wealthy executives.
Administration officials say they are pressing to prosecute fraud involving government-funded programs because Democrats have failed to do so at the federal, state and local levels. Current and former federal prosecutors, however, criticize the change as effectively lowering the standards of a Justice Department that for decades prided itself on tackling big, financially complex investigations in executive suites, and leaving the small cases in corner stores and food trucks to local agencies.
A food truck “is not the kind of case you would typically see federal law enforcement resources being poured into,” said Jacqueline Kelly, a former federal prosecutor. “And that’s resources being pulled from other areas. We’re not seeing an increase in fraud prosecutions involving public companies, investment frauds and the more traditional Wall Street prosecutions typically pursued by the Justice Department.”
Matthew Tragesser, a spokesman for the department, disputed the characterization, saying that it “will never turn a blind eye to fraud.”
“Pursuing only the largest-dollar cases while ignoring smaller ones would send precisely the wrong message — that low-level fraudsters are immune from federal prosecution,” he added. “They are not.”
The White House is directing the administration’s anti-fraud push, with the Justice Department establishing a new division intended to fight fraud whose leaders report to Mr. Vance.
The prosecution of low-level cases has long been left to state and local officials, an arrangement that the Trump administration maintains has allowed small-time fraud to mushroom into a significant drag on public funds. White House officials have pointed to Minnesota, where dozens of people have been accused of stealing millions from a government program meant to keep children fed during the coronavirus pandemic, as an example of the kind of fraud that has been allowed to fester.
The same day that federal prosecutors in Los Angeles announced the case against Ms. Soriano, they trumpeted separate charges against Jesse Cervantes-Gomez, a cashier who worked at a Los Angeles grocery and party supply store. He was accused of accepting $9,559.04 worth of Supplemental Nutrition Assistance Program cards, commonly known as food stamps, as payment to the store and giving undercover ICE agents $4,810 in cash in exchange.
Federal prosecutors initially sought to keep both defendants, who are U.S. citizens, behind bars as they await trial on charges that may not even lead to jail time under federal sentencing guidelines. Judges instead freed them on a $5,000 bond each. A lawyer for Mr. Cervantes-Gomez declined to comment. A lawyer for Ms. Soriano did not respond to a request for comment.
In both instances, the undercover operations to ensnare the defendants were conducted by ICE, an agency whose mission is immigration enforcement.
Food stamp fraud is a simple but enduring scam — use benefits meant to feed low-income people to instead get cash. Until recently, however, those kinds of cases were generally left to local and state investigators, considered too small for the federal government. In the instances of Ms. Soriano and Mr. Cervantes-Gomez, investigators say the businesses tallied up suspiciously high amounts of receipts for food stamps.
In announcing the charges against Ms. Soriano, the Justice Department said the food truck’s lack of scanners, “coupled with consistent high-dollar transactions and rapid back-to-back transactions, are indicators of possible fraud.” Over a one-year period, the truck redeemed more than $600,000 in food stamp benefits, far larger than similarly sized competitors, prosecutors said. That suspicious data is different, however, from the amounts of fraud that can be charged or proved in court.
For decades, federal prosecutors have generally insisted on minimum-dollar thresholds before pursuing fraud cases. In many U.S. attorney’s offices in big cities, the threshold sits around half a million dollars.
In Mr. Trump’s second term, the administration has decreed that that rule of thumb no longer applies. Current and former prosecutors worry that a Justice Department already suffering from the departures of thousands of experienced prosecutors is lowering the bar for fraud cases that will produce more indictments, but less meaningful work.
To try to drive up the number of cases, department officials have internally declared that each assistant U.S. attorney should have at least 25 open cases at all times. For a low-level prosecutor handling common drug or violent offenses — or food stamp fraud — that is not particularly high. For a senior prosecutor handling complex public corruption or corporate fraud investigations, two dozen open cases can be a crushing workload.
In phone calls to prosecutors around the country, a senior Justice Department official, Aakash Singh, has pushed back against criticism of the rule. That threshold of 25 cases is the bare minimum to show that a prosecutor “has a pulse,” he has told officials, according to people familiar with his remarks, who spoke on the condition of anonymity to share the details of internal discussions.
For more than a decade, the number of financial crimes prosecuted by the Justice Department has gradually shrunk. The reasons offered for the broad decline vary — some contend that the government is more reluctant, or less experienced, in pursuing fraud, or that gathering reams of evidence in a digital age has become more time-consuming.
From the start of Mr. Trump’s second term to this May, the administration brought 4,747 white-collar cases, or about 5 percent of the total criminal cases, according to federal statistics analyzed by Justice Connection, a group of former department employees that has been critical of the Trump administration’s sweeping changes.
Those figures are a significant drop from previous administrations (5,554 cases from the same period under President Joseph R. Biden Jr.; 6,626 cases in Mr. Trump’s first term; and 8,781 cases in President Barack Obama’s second term).
The founder of Justice Connection, Stacey Young, said the department under Mr. Trump had been “all over the map when it comes to fraud,” citing its uneven application of prosecutions.
“The president pardons scores of wealthy executives, then creates a new fraud division overseen by the vice president,” she said. “The D.O.J. drops multimillion-dollar fraud cases, then pursues people alleged to have defrauded SNAP of a few thousand dollars. Enforcement priorities send a message, and their message on fraud is chaotic.”
Sarah Krissoff, a former federal prosecutor, warned that pursuing a high volume of low-level fraud cases would come at a price, particularly given the Justice Department’s thinned ranks.
Every new administration, she added, seeks to revamp the department in favor of its priorities, with mixed results.
“They are constantly relabeling stuff, and 95 percent of the time it’s just propaganda — it’s not substantive,” she said. “But this is more significant because the Justice Department has been stripped of so many of its people, particularly its experienced people. If you’re just pushing numbers, you’re going to see a lot of mistakes.”
