COLUMBUS — Five Meigs County men, in southeastern Ohio, have been indicted in federal court for crop insurance fraud totaling nearly $1.6 million.
They are being charged in the U.S. District Court for the Southeastern District of Ohio, with conspiracy, theft of public money and money laundering for allegedly defrauding the federal Non-Insured Crop Assistance Program.
The conspiracy charge is punishable by up to five years in prison, and the more serious crimes are punishable by up to 10 years.
Named in the indictment are: Christopher T. Wolfe, 43, Terry J. McNickle, 51, Mark D. Wolfe, 41,and Joey L. Jerrell, 43, — all of Racine, Ohio. Also charged is Michael L. Johnson, 62, Portland, Ohio.
What happened
According to court records, Wolfe recruited co-conspirators to enroll in NAP for crops that were not planted. His partners would then apply for payments and turn them over to Wolfe after keeping a portion for themselves.
The investigation dates back about two-and-a-half years and involved federal authorities, including the Secret Service, according to Fred Alverson, law enforcement coordinator for the U.S. Attorney’s office in Columbus.
“Something appeared irregular in a number of applications,” Alverson said, noting the Secret Service was involved because of the money laundering charge.
Alverson said investigators believe Wolfe enlisted codefendants to file claims for crops they did not grow, on Wolfe’s behalf. He said investigators are looking at all possible connections and whether there should be any further charges.
NAP provides financial assistance to producers of non-insurable crops when low yields, loss of inventory or prevented planting occur due to a natural disaster. Payments are limited to $100,000 per crop year per individual or entity.
Their defense
Attorney Stephen Palmer, legal counsel for McNickle, said his client intends to plead not guilty. Palmer, of the Yavitch & Palmer Co. law firm, said he had not yet seen a hard copy of the indictment, but said he’s “eager to get involved in the case,” and research his client’s options.
Farm and Dairy left two messages with Samuel Weiner, counsel for Christopher Wolfe, but no response was received before press time.
Being accountable
Alverson said crop insurance fraud is not a common case for his office, but that it’s important to hold anyone accountable who receive government payments.
“Government assistance programs … are set up to help people who truly need it and when individuals try to cheat the system, that takes a lot of time and resources away from helping those farmers or other individuals who need the assistance,” he said.
Alverson said he understands that “government programs can be quite complex and have a lot of rules and regulations,” but warned against actions to “intentionally cheat” the system.
The indictment seeks forfeiture of $1,563,337.30, which allegedly represents the proceeds traceable to the commission of the crimes.
Arraignment hearings for the defendants have been set for June 23 in federal court, in Columbus. During their arraignment, the defendants will be given opportunities to enter pleas of guilty or not guilty.
The indictment was formally announced by Carter Stewart, U.S. attorney for the Southern District of Ohio; Mark Porter, special agent in charge, U.S. Secret Service; and Derrick Hurst, acting special agent in charge, U.S. Department of Agriculture-Office of Inspector General.
Insurance background
According to National Crop Insurance Services, a nonprofit trade organization that promotes the U.S. crop insurance industry, farmers spent nearly $4.5 billion in 2013 on more than 1.2 million crop insurance policies.
That amount will likely increase this year, as the new farm bill ends direct payments to farmers and encourages farmers to manage their own risks by buying crop insurance.
Only a small portion of farmers who purchase crop insurance collect indemnities, according to National Crop Insurance Services.
For example, more than 1.14 million policies were purchased by farmers in 2010, only 266,000 were indemnified.
In 2011, a year that saw multiple natural disasters, roughly 1.15 million policies were purchased by farmers and only 396,000 were indemnified.
“Farmers do not count on receiving an indemnity, and when they do receive one, their insurance guarantees in the future go down and their premium rates go up,” according to the organization.
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