INSURANCE AGENT SUSPENDED FROM THE FEDERAL CROP INSURANCE PROGRAM

Contact: Shirley Pugh (202) 690-0437
James Callan (202) 720-8812

WASHINGTON, Dec 19, 2003 - USDA's Risk Management Agency Administrator and Federal Crop Insurance Corporation (FCIC) Manager Ross J. Davidson, Jr., has announced the suspension of Dean Payne, Payne Insurance Company of Greenville, Tenn., from participation in the Federal crop insurance program following his indictment on four counts of conspiracy to defraud the United States Department of Agriculture (USDA).

"This administration will not tolerate the abuse of program funds allocated for the benefit of the American agricultural producer," said Davidson. "Agriculture Secretary Veneman has charged us to work diligently to combat fraud, waste and abuse of the federal crop insurance program."

On September 23, 2003, a grand jury in the United States District Court for the Eastern District of Tenn., Greenville, indicted Dean Payne on four counts of conspiracy to defraud the USDA, including impeding, impairing, obstructing and defeating the lawful governmental functions of the USDA. The allegations include his having aided and abetted an agricultural producer to defraud the government of $57,155 by submitting a false crop insurance application and a fraudulent claim. He is also alleged to have provided information related to production history in Cocke County, Tenn., showing acreage and production for 1992, 1993, 1994 and 1995, knowing the information to be fictitious.

Pursuant to USDA Regulation 7 C.F.R. § 3017.700, suspension may be imposed when adequate evidence that a cause for debarment under 7 C.F.R. § 3017.305(a) exists and immediate action is necessary to protect the public interest. An indictment constitutes adequate evidence for the purpose of suspension. The suspension will remain in effect pending the outcome of the trial. A conviction may be used as a basis for debarment from all government programs.

The agencies involved in the investigation of this case are the Office of Inspector General of the USDA and the Internal Revenue Service Criminal Investigations. The North Carolina State Bureau of Investigation and the Henderson County Sheriff's Office have also assisted the United States in the investigations.

This announcement follows the recent suspension of four individuals and a farm corporation in North Carolina from participating in the federal crop insurance program after they were indicted for conspiracy to defraud the USDA of more than $12 million. Between 1995 and 2001, the FCIC issued suspension notices in seven cases. The notice in the Payne case marks the seventh Davidson has issued since 2002.