Cave City farmer among those sentenced in crop insurance fraud case

Cave City farmer Larry Walden was sentenced on Dec. 19 in connection with a large-scale insurance fraud investigation, officials say.

CAVE CITY, Ky. — A Cave City farmer, 69-year-old Larry Walden, has been sentenced to 52 months of incarceration after pleading guilty to conspiring to commit money laundering by committing crop insurance fraud, officials say.

According to a release by the United States Attorney’s Office, Western District of Kentucky, a plea agreement states Walden “owned farmland in Barren County, on which he grew burley tobacco, among other crops” and that  “he maintained insurance coverage over his tobacco crop from at least 2014 to 2023.”

In addition, the release states that “for crop years 2014 through 2019, Walden used services offered at Farmers Tobacco Warehouse in Boyle County to obtain false documentation to support false claims of loss on his crop insurance.”

According to the release, Walden “wrote checks to Farmers Tobacco Warehouse to make it appear as though the tobacco he raised and sold was actually purchased from Farmers Tobacco Warehouse.”

The release further states Walden conspired with Thomas Kirkpatrick, manager of Farmers Tobacco Warehouse, for Walden to receive “fake receipts.” Walden then presented copies of canceled checks, according to the release, with fake purchase receipts to his insurance adjuster. The insurance adjuster then used the paperwork to “justify deflating Walden’s production reports, thereby increasing his indemnity payment,” the release states.

With this, the release states Walden paid off lines of credit and bought new assets.

Walden additionally admitted to running the same fraud scheme through Greensburg Tobacco Market and Fair Deal Tobacco in Greensburg and Littleton, North Carolina, the release states.

Walden further sold tobacco under the names of neighbors and relatives without reporting the production on his insurance claims, officials say. In total, the release says Walden’s fraud caused over $9.9 million in loss to crop insurers.

Upon his release, Walden will be under the supervision of the U.S. Probation Office for three years. In addition to his sentence, Walden was ordered to pay $9,960,817.19 in restitution.

Kirkpatrick, 67, of Stanford, a former manager of Farmers Tobacco Warehouse, was sentenced to 48 months in prison, two years of supervised release and was ordered to pay $16,156,345 in restitution.

In addition, the following individuals were also charged in this case, officials say:

• David Hunt, 63, of Campbellsville, a farmer who obtained fake documentation from Kirkpatrick in order to support fraudulent claims to indemnity payments under an organic tobacco insurance coverage policy, was sentenced to 42 months in prison, three years of supervised release, and $5,427,365 in restitution.
• Terry Wilson, 67, an Edmonton, farmer who used Farmer Tobacco Warehouse to facilitate his fraud conspiracy, was sentenced to time served, followed by three years of supervised release, and was ordered to pay $667,679.00 in restitution.
• Christopher Wilson, 50, Terry Wilson’s son, was sentenced to 18 months in prison, three years of supervised release, and was ordered to pay $669,447 in restitution.
• David Wisdom, 69, a Glasglow, farmer who used Farmer Tobacco Warehouse to facilitate his fraud conspiracy, was sentenced to 48 months, followed by three years of supervised release, and was ordered to pay $1,941,007 in restitution.
• Robert D. Birge, Jr., 51, a Summer Shade, farmer, was sentenced to 6 months in prison, three years of supervised release, and was ordered to pay $1,114,519 in restitution.
• Additionally, earlier this month, Harlan Ray Highfield, 63, of Brooksville, was sentenced to 42 months’ incarceration, stemming from his crop insurance fraud scheme that involved obtaining crop insurance policies in nominee names, among other offenses. He was sentenced to three years’ supervised release and was ordered to pay $1,060,460 in restitution.

Under federal law, these defendants must serve 85% of their prison sentences.

“There is no place in our society for opportunists who choose to defraud public programs at the expense of honest, hard-working American farmers,” stated special agent in charge Olivia Olson of the FBI Louisville Field Office. “This case is a prime example of law enforcement partners collaborating over a number of years to ensure the conspirators are identified and penalized appropriately, while simultaneously working to protect one of our nation’s most vital industries.”

The investigation was conducted by the United States Department of Agriculture Office of Inspector General, United States Department of Agriculture Risk Management Agency Special Investigations Staff, Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigation.