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Crop insurance fraud case settled

(WISH Photo)

WARSAW, Ind. (Inside INdiana Business) — A crop insurance company based in Warsaw and its chief executive officer have agreed to pay $500,000 to settle allegations that they were involved in a federal crop insurance scam. The U.S. Department of Justice says Silveus Insurance Group Inc. and CEO James Cameron Silveus violated federal laws by facilitating the submission of fraudulent claims.

According to a release from the U.S. Attorney’s Office of the Western District of Michigan, Silveus was the crop insurance agent for Michigan-based crop farmer Gaylord Lincoln. The Justice Department says Silveus, on behalf of Lincoln, filed federal crop insurance claims at a higher level than Lincoln was entitled.

The federal government says Lincoln placed some of his farmlands and crops under the names of farmhands who served as “straw” farming operators who answered to him. Lincoln also allegedly ordered the employees to fraudulently obtain federal crop insurance policies to which they were not entitled.

The Justice Department says the federal government, through the Federal Crop Insurance Corp., paid subsidy premiums and indemnities on the false policies. The federal government says administrative costs were paid to Silveus and the company.

“The federal crop insurance program is designed to promote the national welfare by creating economic stability for farmers,” said United States Attorney Andrew Birge. “This system relies on producers and their insurance agents to submit truthful and complete information, and my office is committed to investigating any allegations of fraud on the federal crop insurance program.”

In addition to the fine, the DOJ says SIG also agreed to enter into a one-year monitoring period with the U.S. Department of Agriculture’s Risk Management Agency.