Minnesota Farmer To Be Sentenced on Insurance Fraud

Minnesota Farmer Faces March 24 Sentencing for Making False Statements to Federal Crop Insurance Corp.

Todd Neeley
By  Todd Neeley , DTN Staff Reporter
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Minnesota farmer Kevan Jon Nelson is scheduled to be sentenced on March 24. (Photo by Tim Evanson, cc-by-sa-2.0)

LINCOLN, Neb. (DTN) -- A Minnesota farmer who pleaded guilty to making false statements to the Federal Crop Insurance Corp. is scheduled to be sentenced next month, according to court documents filed in the U.S. District Court of the District of Minnesota.

The U.S. Department of Justice agreed to not seek the maximum sentence against northwest Minnesota farmer Kevan Jon Nelson; Nelson is scheduled to be sentenced on March 24.

As part of a plea agreement, Nelson is required to pay restitution to the FCIC on a charge that could carry up to 30 years in prison and more than $1 million in fines. He could face 21 to 27 months in prison and pay fines ranging from $10,000 and $95,000, according to a plea agreement reached.

In addition, Nelson has agreed to forfeit eligibility for 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 2021 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.

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.

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