Federal Crop Insurance Fraud
Many farmers are finding themselves in serious trouble lately with what is known as Federal Crop Insurance Fraud. This federal crime punishes the following conduct: to “knowingly make false statements and reports for the purpose of influencing in any way the action of the Federal Crop Insurance Corporation (FCIC), and companies the FCIC reinsures, upon an application, advance, commitment, loan, insurance agreement, application for insurance and a guarantee, and any change or extension of any of the same, by renewal, deferment of action and otherwise." The federal statute involved is 18 U.S.C. §1014 and it carries a penalty of up to 30 years in federal prison.
Crop losses are backed by the FCIC, and farmers find themselves running afoul of the federal government when they inaccurately report their crop losses for any given season. The resulting payment of insurance proceeds to the farmer for this loss involves the federal government because of this FDIC connection. Of course, a report, to be subject to federal criminal prosecution must be knowingly false.
As mentioned above the prison sentence may be as much as 30 years. One should also understand that the federal government has abolished parole. Hence, the time to which a judge sentences a defendant will be the time that defendant serves—all without parole. The dollar amount of the fraud involved is a major driving force in the ultimate sentence. In other words, the greater the amount of money involved in the false reports, the higher the prison sentence.
As one can imagine, a substantial amount of records are involved in a federal investigation of crop insurance fraud. Of course, the entire financial resource of the federal government is at the disposal of the United States attorney conducting the investigation. Insurance records, a farmer’s crop records, bank records, and tax records are all the subject of federal government inspection. Oftentimes a farmer will be approached by a federal investigator that has been conducting the government’s probe. One thing that a farmer (or anyone for that matter) must always remember: if you choose to answer questions from a federal investigator (which you don’t have to do) always tell the truth. Why? If you don’t you would be subject to an additional federal criminal charge of what is known as “obstruction of justice." Best advice: politely ask the federal agent for permission to consult a federal criminal attorney. They will always understand that and allow you to do so. That is your right.