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Feds bust up $100M NC crop insurance fraud ring
Associated Press ^ | 3-12-2013 | MICHAEL BIESECKER

Posted on 03/12/2013 1:50:18 PM PDT by haffast

RALEIGH, N.C. (AP) — Federal investigators have unraveled a massive scheme among dozens of insurance agents, claims adjusters, brokers and farmers in eastern North Carolina to steal at least $100 million from the government-backed program that insures crops.

Forty-one defendants have either pleaded guilty or reached plea agreements after profiting from false insurance claims for losses of tobacco, soybeans, wheat and corn. Often, the crops weren't damaged at all, with farmers using aliases to sell their written-off harvests for cash.

Prosecutors compared the case to busting a drug cartel, where federal investigators used a confidential informant to ensnare a key participant in the sophisticated fraud, who then agreed to implicate others. That first wave of prosecutions led to still more names to investigate.

"These defendants make it harder on the honest farmer," Assistant U.S. Attorney Banumathi Rangarajan said. "The more they lie and steal the more premiums and costs go up for the farmers who play by the rules."

snip

"There's always fraud in the crop insurance system, but I've seen nothing to suggest it is pervasive," Babcock said. "Eighty percent of the program costs are supported by the federal government. Some people see defrauding taxpayers like cheating on their income taxes."

Those prosecuted in North Carolina raked in millions for years without detection until 2005, when prosecutors say USDA auditors used computer software to mine insurance claims data from across the country for outliers.

snip

"I can tell you it's everywhere, all across the country," Sasser said Monday. "When you let the farmers keep up with their own production, they can put that production anywhere they want to. All the adjuster does is take what the farmer gives him to work the claim. What the farmer does before the adjuster gets there, the adjuster has no idea."

snip

(Excerpt) Read more at news.yahoo.com ...


TOPICS: Business/Economy; Crime/Corruption; Government; US: North Carolina
KEYWORDS: farmers; tobacco

1 posted on 03/12/2013 1:50:18 PM PDT by haffast
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To: haffast

You reap what you sew.....


2 posted on 03/12/2013 1:52:32 PM PDT by illiac (If we don't change directions soon, we'll get where we're going)
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To: illiac

Hehe!


3 posted on 03/12/2013 2:03:01 PM PDT by Sawdring
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To: haffast

That’s a pretty good scam.

The solution, of course, is less government programs in this area, because government-run insurance has oversight that is lax in comparison with private insurance.

Another possible solution is the bullet in the back of the head for economic crimes method, but I’d prefer we not go there.


4 posted on 03/12/2013 2:11:55 PM PDT by Pearls Before Swine
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To: haffast

Could this ring have existed if the government wasn’t in the insurance biz?


5 posted on 03/12/2013 2:12:54 PM PDT by Vince Ferrer
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To: Vince Ferrer

Very probably not.


6 posted on 03/12/2013 2:17:50 PM PDT by RetiredTexasVet (Leveling the playing field for a Progressive is dragging everyone down to their level.)
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To: haffast
PIKERS!

This is how to do it... (with a little help from Obey...)

... To properly read between the lines in the bureaucratic doublespeak and intentionally dense legalese that makes up Farmers Settlement documentation, it is important to understand how fraud actually worked in Pigford. Fraud was not primarly people falsely claiming that they had farmed. It was actually much simpler than that. You did not need to prove that you actually farmed, only that you “attempted to farm.”

The low bar was a trick that the lawyers and politicians put into Pigford years ago; the “attempted to farm” standard. All you had to do was to say that you attempted to farm. In other words, you made the unprovable claim that you went to a USDA office and they did not even give you an application. Your lack of an application or any other documentary evidence became the proof that you had suffered discrimination. ...

-NEW OBAMA 'PIGFORD' FARMERS SETTLEMENTS DESIGNED FOR FRAUD


7 posted on 03/12/2013 2:19:58 PM PDT by WVKayaker ("I've seen how nasty it can be for other conservatives as well. "-Sarah Palin 12/17/12)
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To: haffast

“Banumathi Rangarajan” - probably a great guy - just commenting on his typical TarHeel name (sarc)


8 posted on 03/12/2013 3:09:42 PM PDT by elpadre (AfganistaMr Obama said the goal was to "disrupt, dismantle and defeat al-hereQaeda" and its allies.)
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To: haffast
About time somebody pointed this out.

This is a club. The farmers are farmers, the crop insurance adjusters are farmers.

All it takes is for one farmer to allege to the other farmer that there was a crop loss, and BINGO!.

9 posted on 03/12/2013 3:28:11 PM PDT by elkfersupper ( Member of the Original Defiant Class)
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To: Pearls Before Swine

This is much like the ‘insurance’ called unemployment insurance. If the govt can arbitrarily declare that payouts should be 99 weeks then it isn’t really ‘insurance’ it is just another government program.

If it were really insurance then people would pay in proportion to their likelihood of being in a layoff and in finding new work.


10 posted on 03/12/2013 4:41:04 PM PDT by posterchild (Remember that thou art dust and to dust thou shalt return.)
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