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Rebating Violations and Sanctions

Mar 27, 2014

The Agricultural Act of 2014 amended section 508(a)(9) of the Federal Crop Insurance Act (7U.S.C. 1508 (a)(9)) by adding at the end subsection (C) - “Publication of Violations.”

Section 508(a)(9) of the Federal Crop Insurance Act (Act) currently states:

(9) PREMIUM ADJUSTMENTS.-

(A) PROHIBITION.- Except as provided in subparagraph (b), no person shall pay, allow, or give, directly or indirectly, either as an inducement to procure insurance or after insurance has been procured, any rebate, discount, abatement, credit, or reduction of the premium named in an insurance policy or any other valuable consideration or inducement not specified in the policy.
(B) EXCEPTIONS.—Subparagraph (A) does not apply with respect to—
(i) a payment authorized under subsection (b)(5)(B);
(ii) a performance-based discount authorized under subsection (d)(3); or
(iii) a patronage dividend, or similar payment, that is paid—
(I) by an entity that was approved by the Corporation to make such payments for the 2005, 2006, or 2007 reinsurance year, in accordance with subsection (b)(5)(B) as in effect on the day before the date of enactment of this paragraph; and
(II) in a manner consistent with the payment plan approved in accordance with that subsection for the entity by the Corporation for the applicable reinsurance year.
(C) PUBLICATION OF VIOLATIONS. –
(i) PUBLICATION REQUIRED. – Subject to clause(ii), the Corporation shall publish in a timely manner on the website of the Risk Management Agency information regarding each violation of this paragraph, including any sanctions imposed in response to the violation, in sufficient detail so that the information may serve as effective guidance to the approved insurance providers, agents, and producers.
(ii) PROTECTION OF PRIVACY. – In providing information under clause (i) regarding violations of this paragraph, the Corporation shall redact the identity of the persons and entities committing the violations in order to protect the privacy of those persons and entities.

Per subsection (C) above, the Risk Management Agency (RMA) is required to publish rebating violations on its website. Below are the rebating violations and sanctions imposed by RMA since enactment of the Agricultural Act of 2014:

Posted violations and sanctions are forthcoming.

Contact Information

For more information, contact Dave Miller.