Second defendant in food stamp fraud case is sentenced to probation

Pago Pago, AMERICAN SAMOA — One of the co-defendants in the food stamp fraud case was released from custody last Friday, after the High Court sentenced him to 7 years of probation.

Liren Zhang, a.k.a Kevin was in TCF custody since his arrest, unable to post a $450,000 surety bond.

He appeared in court last Friday for sentencing, represented by Thomas Jones of RDA Law Firm. Assistant Attorney General Laura Garvey was the prosecutor.

(Zhang's two co-defendants are Jane Vasa — who was sentenced last year to a one-year probation term — and Vincent Toeava, who remains in custody unable to post a $450,000 bond. His trial is set for May 20.)

Zhang was initially charged with 9 counts of forgery and 6 counts of stealing, all class C felonies. But under a plea agreement, Zhang pled guilty to one count of stealing. The remaining charges were dismissed.

Zhang apologized to the court and begged for another chance to return home to be with his family. He also apologized to the people and government of American Samoa.

“I see a lot of changes in my life," Zhang told the court, adding he wants to continue to serve the community and his family. "I also want to stay here in American Samoa,” he said.

Counsel Jones asked for probation, saying Zhang takes full responsibility for his actions and he’s truly remorseful. He said his client is a first-time offender and he fully cooperated with investigators when this case surfaced last year.

Prosecutor Garvey echoed the defense’s submission for probation but asked the court to order Zhang to pay $702,279.30 in restitution, which the government determined was the total amount involved in the scheme.

Chief Justice Michael Kruse sentenced Zhang to 7 years imprisonment and a $5,000 fine. Execution of the sentence is suspended, and Zhang is placed on probation for 7 years subject to the following conditions.

He is ordered to serve 28 months detention which will be carried out as follows: He shall serve 15 months at the TCF. Afterwards, he shall be released from confinement and will appear in court Dec. 18, 2023 for a review, and the court will notify him on that day, when he’s going to serve the balance of detention.

He is to pay $5,000 along with restitution of $702,279.30

Zhang is not to make any direct or indirect contact with the co-defendants or their immediately family members. And he is not eligible for Trustee status at TCF. Zhang has already spent 15 months in pretrial confinement and therefore, he was released last Friday.

Zhang was ordered to depart the territory, but this condition has been stayed, until further order of the court.

THE CASE

It was Jan. 4, 2018 that DHSS director Muavaefaatasi John Suisala was alerted about the depletion of ASNAP funds for the first quarter of fiscal year 2018.

ANZ Bank had redeemed $667,555 more during the 1st quarter of 2018 than what ASNAP issued to its recipients. It was discovered that excessively high amounts of counterfeit ASNAP food coupons were redeemed by 3 ASNAP authorized retailers during this period.

Two of the retail stores are owned by the same person (Zhang) while the third is owned by an individual, who is yet to be arrested and charged. Zhang's stores are JFL Malae Store and Fast By Food Mart.

According to the government, the counterfeits bore the same serial numbers and were in $10 denominations only, stamped for deposit by the same 3 stores. Coupons issued in FY 2017 and redeemed in Oct. 2017 had been altered to benefit ‘JFL Malae Store’ and ‘Fast By Food Mart’. The total value of the coupons was $94,126 of which most were altered.

According to Zhang, sometime in May 2017 he spoke to the late Taeaoafua Meki Solomona at his office about a WIC-related problem. Zhang said he and Meki (who was then DHSS director) were close friends.

(Samoa News identifies Taeaoafua as Solomona, based on Zhang’s statement).

This meeting was the beginning of a series of incidents that culminated with Zhang participating in the DHSS food stamp fraud.

It began with Zhang handing over his car rental business (Malae Rental) with two vehicles to Solomona’s wife, with the agreement negotiated by Toeava, Solomona’s son-in-law; and later — in Sept. 2017 — Toeava going to Zhang’s Vailoa store and proposing the food stamp fraud scheme — which included a ‘50-50’ split of the money from redeeming the fraudulent food stamp coupons.

Zhang said he was uncomfortable with the proposition, but Toeava told him not to worry, ‘Papa Meki’ would be notified. Zhang said he then felt at ease and they proceeded to alter $86,854.00 in $10 denominations worth of food stamp coupons, and redeemed them at the ANZ- Amerika Samoa bank.

According to the affidavit, Toeava was giving thousands of dollars in food stamps to Zhang every two weeks to alter and redeem.

(See Samoa News Jan. 24, 2018 edition for details of the case against all three defendants).