Fleming woman faces prison on fraud charges

By Mary Ann Kearns - [email protected]
Tobacco hangs in a barn as it cures. -

A Fleming County woman could face up to 30 years in prison after she entered a guilty plea Monday to helping some tobacco farmers take thousands of dollars through the government-backed crop insurance program.

Debra Muse, 63, of Wallingford, who served as an agent for crop insurance will be sentenced in July in U.S. District Court in Lexington after entering two guilty pleas before U.S. District Judge Joseph M. Hood. In addition to any sentence she receives, Muse could face more than $1 million in fines, according to court documents.

Muse had been scheduled to go on trial in federal court Monday in Lexington, but the trial was canceled following her guilty plea to one count one of conspiring to defraud the United States Federal Crop Insurance Corporation and one count of making a false statement and report to the FCIC, the plea agreement indicates.

Under the agreement, federal prosecutors said they would, at sentencing dismiss 26 other charges originally brought in the case.

The conspiracy aimed to profit those involved, including Muse and clients identified only by initials, by filing fake insurance claims and selling unreported tobacco, according to the indictment.

The fraud identified in the first count of the indictment occurred in the fall of 2014 and early 2015 when Muse directed insurance payments of $169,251 to three clients. The claims “falsely inflated” the number of tobacco losses suffered by farmers, the indictment indicated.

Muse was employed as a seasonal worker at Clay’s Tobacco Warehouse in Mount Sterling where tobacco was accepted for purchase and resale. She was also a crop insurance agent.

In connection with her job at the warehouse, Muse entered information into a computer program that tracked the purchase, sale and shipment of tobacco.

In her work as an insurance agent, Muse secured policies for her clients. Those multiple co-conspiring farmers, according to court records, “at the urging of and with help” from Muse, filed false claims.

The purpose of the conspiracy was to profit through the filing of the fake insurance claims and the sale of unreported or hidden tobacco, the indictment said.

The fraud detailed in the first count of the indictment occurred in late 2014 and early 2015 when Muse caused insurance payments totaling $169,251 to be made to three clients. The claims “falsely inflated” the amount of tobacco losses suffered by farmers, the indictment said.

As a crop insurance agent, Muse obtained policies for her clients. Those farmers, “at the urging of and with help” from Muse, filed false claims in various ways, the indictment claims.

The co-conspirators profited under the scam because they were paid twice for each pound of tobacco — once through the fake insurance claim and also through the sale of the unreported hidden tobacco, the indictment said.

Muse profited by collecting the insurance commission, by retaining and expanding the business of her crop insurance clients and by securing business for the tobacco warehouse.

Muse pleaded guilty to aiding and abetting a grower, identified only by the initials “B.O.,” by making a false statement. A false sales bill she created showed that B.O. sold 2,472 pounds of tobacco at auction on Jan. 7, 2015, at Clay’s Tobacco Warehouse when the sale did not take place.

Sentencing is set for July 30. In the meantime, Muse will remain free on bond.

Muse is being represented by attorney John Helmuth. Assistant U.S. Attorney Erin Roth acted on the government’s behalf.

Tobacco hangs in a barn as it cures.
https://maysville-online.com/wp-content/uploads/2018/04/web1_tobacco.jpgTobacco hangs in a barn as it cures.

By Mary Ann Kearns

[email protected]