Michael McNew, Crop Insurance Fraud, Kentucky 2024

LEXINGTON, Ky. – In a sweeping crackdown on crop insurance fraud, two men were sentenced to prison for their roles in a scheme that bilked the federal government out of over $32 million.

Michael McNew, 51, a former crop insurance adjuster and agent from Mt. Sterling, was sentenced to 86 months in federal prison for conspiracy to commit wire fraud. McNew admitted to inflating or falsifying damage to crops and acreage reported to obtain larger insurance payouts.

McNew’s scheme, which ran from at least 2012 to 2018, resulted in a total loss of $23,000,000 to the federal government. He also submitted fake applications for crop insurance for individuals who were not farmers, but were relatives or friends of his farmer co-conspirators.

Roger Wilson, 88, the owner of Clay’s Tobacco Warehouse in Mt. Sterling, was sentenced to 12 months in federal prison for conspiracy to commit crop insurance fraud. Wilson arranged for farmers to purchase poor quality tobacco, which they would then use to get fake grades to apply to their insurance claims of loss.

Wilson’s scheme, which ran from September 2013 to at least May 2018, resulted in a loss of over $9,000,000 to the federal government. He also produced fake sales receipts, shipping reports, and bale tags to facilitate the fraudulent crop insurance claims.

McNew pleaded guilty in October 2020, while Wilson pleaded guilty in May 2021. Both men will be under the supervision of the United States Probation Office for a period of three years upon their release from prison.

McNew must also pay restitution of $19,596,936. Wilson’s restitution order is still pending before the court.

Other recent crop insurance fraud convictions have resulted in sentences ranging from six months to 36 months in prison. The investigations were conducted by the United States Department of Agriculture Office of Inspector General, the Federal Bureau of Investigation, and the Internal Revenue Service-Criminal Investigation.

The cases were brought as part of a larger effort to combat crop insurance fraud in Kentucky. The investigation is ongoing, and additional charges are expected to be filed in the coming weeks and months.

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