(Valley News Live) – Two North Dakota farmers are facing federal charges after prosecutors say they hid how much they harvested from insurance adjusters so they could collect crop insurance payments for losses that did not happen.
A federal grand jury indicted Daniel Scott Flaten and Derek Scott Flaten on one count of conspiracy to make false statements to influence the Federal Crop Insurance Corporation, according to an indictment filed in U.S. District Court for the District of North Dakota. Daniel Flaten is also charged with two counts of making false statements, and Derek Flaten with two counts. The indictment is dated Oct. 8.
The indictment says that between 2016 and 2025 the two insured crops and submitted claims, personally and on behalf of others, and that they received nearly $15 million in crop insurance payments, subsidies and disaster payments. It does not allege that all of that money was improper. It says the conspiracy ran from about January 2021 to Jan. 31, 2023, and that the Flatens collected about $619,130 they weren’t entitled to on just three crop insurance policies. The government also paid about $103,966 in additional subsidies connected to those policies, according to the indictment.
How prosecutors say it worked
According to the indictment, Daniel Flaten reported false losses on corn and soybeans he farmed. During the same seasons, the indictment says, he sold some of his corn under Derek Flaten’s name, telling grain elevators the corn came from Derek’s fields. That made his own reported production look lower, and he claimed the shortfall came from natural causes such as drought, the indictment says.
Derek Flaten, or other family members, then reported artificially high production, which raised his own production history. A higher history raises the amount of insurance coverage per acre in later years, according to the indictment.
The indictment says the two hid actual production from insurance adjusters, and that two adjusters from one insurer questioned reported yields that were far below area yields. The insurers ultimately accepted the Flatens’ certifications and paid the claims, according to the indictment.
What the harvest data showed
Prosecutors allege Daniel Flaten hid data from precision-farming equipment that recorded yields during harvest. For 2021 corn in Cass County, the indictment says he certified yields of 67 to 90 bushels an acre on four units while the equipment recorded 116 to 144 bushels an acre. For 2022 corn, he certified yields of 72 to 115 bushels an acre on five units, while the equipment recorded 120 to 171, according to the indictment.
The indictment lists indemnity payments Daniel Flaten received, including $279,948 for his 2021 Cass County corn and about $182,391 for his 2022 corn, plus another $23,563 in federal disaster payments. It also says he certified that he planted his 2022 corn before June 1, when he actually planted between June 4 and June 15.
The charges
- Count 1 (both): conspiracy to make false statements to influence the Federal Crop Insurance Corporation.
- Counts 2 and 3 (Daniel Flaten): making false statements. The indictment says he falsely certified on Nov. 15, 2021, that 452.65 acres of dry beans and 412.42 acres of soybeans were damaged solely by natural causes.
- Counts 4 and 5 (Derek Flaten): making false statements. The indictment says he falsely certified on Feb. 19, 2022, that 1,562.14 acres of soybeans were damaged solely by natural causes, and on Feb. 29, 2024, that 2,109.39 acres of soybeans were damaged solely by natural causes.
Prosecutors are also seeking forfeiture of proceeds from the alleged violations.
The indictment says Daniel Flaten farmed in Cass, Grand Forks, Traill and Steele counties and also handled crop insurance claims for a relative’s farm under a power of attorney. It does not charge that relative.
This story is based on a federal indictment, which contains allegations that have not been proven in court.
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