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- DTN Headline News
Farmer to Plead Guilty to Insurance Fraud
By Todd Neeley
Friday, October 15, 2021 10:47AM CDT

LINCOLN, Neb. (DTN) -- A northwest Minnesota farmer charged with crop insurance fraud is prepared to enter a guilty plea, according to a court document filed in the U.S. District Court for the District of Minnesota on Thursday.

Lake Park, Minnesota, corn and soybean farmer Kevan Jon Nelson was charged in September after allegedly reporting false information to the Federal Crop Insurance Corporation in 2018.

A plea agreement teleconference hearing is scheduled for Monday.

"The defendant has agreed to plead guilty to the offense pursuant to a plea agreement," attorneys for the U.S. Department of Justice said in a court document filed on Thursday. "The conduct to which the defendant will plead guilty occurred in 2018 and 2019. However, investigation has spanned conduct in other years."

On Sept. 30, 2021, lawyers for Nelson filed notice of the defendant's consent to a video conference for a change of plea hearing. The teleconference was agreed to for several reasons, including the need for Nelson to continue harvest.

Nelson was charged with one count of making a false statement on a Federal Crop Insurance Corp. application on or about Nov. 30, 2018, according to court records.

Making false statements on crop insurance applications is a felony punishable by up to a $1 million fine and 30 years in prison.

"Further, the defendant is a farmer who resides more than 200 miles from the Twin Cities," the DOJ said in its filing.

"Travel to appear in court in person can take up to four hours one way. The current time of year, with harvest approaching, is crucial to farmers. The opportunity to appear by remote-video connection will enable the defendant to complete the urgent tasks that arise during the fall season.

"Given the drought conditions suffered by farmers this year, it is especially important to ensure that farmers are able to maximize their return on crops planted for this season. In the case of the defendant, the ability to maximize harvest will carry the additional benefit of supporting greater and quicker payment of restitution."

According to court documents, in 2018 and 2019, Nelson "falsely reported losses in those years to obtain crop insurance payments to which he was not entitled, resulting in his receipt of $548,695 in fraudulent payments."

The DOJ said Nelson allegedly "knowingly and willfully made" false statements on or about Nov. 30, 2018, for the "purpose of influencing the action of an insurer reinsured by the Federal Crop Insurance Corporation. Specifically, Nelson falsely certified to ARMtech Insurance Services that he was entitled to $117,740 for corn and soybean crops lost to excess moisture" in Becker and Clay counties in Minnesota.

If convicted, court records said, Nelson would be required to forfeit any property "derived from proceeds" obtained directly or indirectly as a result of the violation.

"The property subject to forfeiture includes, but is not limited to, a money judgment not to exceed $548,695," according to the charges filed in court.

"If any of the above-described forfeitable property is unavailable for forfeiture, the United States intends to seek the forfeiture of substitute property."

According to the Environmental Working Group's farm subsidy database, Nelson's farm has received $1.97 million in subsidies from USDA from 1995 to 2020. That includes $135,680 in 2018 and $125,015 in 2019.

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @DTNeeley


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