Minnesota Farmer Signs Plea Agreement

DOJ Agrees to Reduced Sentence of Minnesota Farmer on Crop Insurance Fraud

Todd Neeley
By  Todd Neeley , DTN Staff Reporter
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The U.S. Department of Justice has agreed not to seek the maximum penalty against Minnesota farmer who pled guilty to crop insurance fraud. (Photo by Tim Evanson, cc-by-sa-2.0)

LINCOLN, Neb. (DTN) -- The U.S. Department of Justice has agreed to not seek the maximum sentence against a northwest Minnesota farmer who pled guilty to one count of making false statements to the Federal Crop Insurance Corp., according to the plea agreement.

Kevan Jon Nelson signed a plea agreement that will require him to pay restitution to the FCIC, according to documents filed with the U.S. District Court for the District of Minnesota.

Although Nelson could face up to 30 years in prison and more than $1 million in fines, based on the level of the offense and prior criminal history, he could face 21 to 27 months in prison and pay fines ranging from $10,000 and $95,000, according to the agreement.

In addition, Nelson has agreed to forfeit eligibility from any federal program administered, authorized or funded by USDA, including by the Risk Management Agency, the FCIC and the Farm Service Agency. The agreement also shields Nelson's sons, Jacob and Ryan, from prosecution that could arise as part of the investigation.

The Lake Park, Minnesota, corn and soybean farmer was charged in September after allegedly reporting false information to the FCIC in 2018.

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." As part of the plea agreement, Nelson is to repay the amount to the FCIC.

"The defendant understands and agrees that an order for restitution is mandatory in this case, and he agrees to pay restitution of $548,695 to the Federal Crop Insurance Program and any other victims of his offense as determined by the court," the plea agreement stated.

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, Minnesota, all in violation of title 18, United States Code, Section 1014," according to the agreement.

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.

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

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

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Todd Neeley