Indiana Farm Bureau’s Chief Executive Officer, Jerry Canada, recently voiced the company’s steadfast commitment to continue to work with investigators as well as to support policyholders who were victims of fraud and other criminal violations by a former Farm Bureau agent.
Former Farm Bureau Insurance Company agent, Curtis W. Knecht from Veedersburg, agreed to plead guilty to bank and insurance fraud and filing false tax returns in a scam that allegedly took more than $1.4 million from clients, according to charges filed by in U.S. District Court. He was arraigned in the United States District Court in Indianapolis on Wednesday (Jan. 11) of this week.
(See Insurance Journal Web site article, Midwest, Jan. 9, 2005).
Knecht, a licensed agent with Farm Bureau from February 1986 through March 2005, is accused of pocketing premiums and committing illegal acts against several of his customers.
“Adequate words do not exist to express the level of outrage and disappointment we feel over Mr. Knecht’s unconscionable treatment of customers and abuse of the trust his clients and our company placed in him,” Canada said in his letter to employees and agents. “We terminated our 19-year contract with Mr. Knecht in March 2005 after instituting a company investigation of his business practices and began working with officials on their criminal investigation. The company has worked closely with the U.S. Attorney’s office and state and federal law enforcement agencies to investigate and determine how this fraud was committed and the nature and scope of the losses suffered by our customers and our company.”
Canada said that the company “has devoted countless hours to compiling and providing the information and access necessary to the criminal investigation.
The Farm Bureau said it has identified all clients who may have been victims of the former agent’s crimes.
The priority during these many months of thorough research and investigation has been to take care of our customers, Canda stated.
“Our clients and our company suffered losses of well over $1 million. We have worked with each client identified as a victim of Mr. Knecht’s schemes to ensure that every individual’s losses are repaid, providing clients with choices and helping them determine the best method for making them “whole,” Canada said.
Canada added that the payments we have made to financially indemnify affected clients will have an impact on our life insurance company’s earnings for 2005.
“However, Indiana Farm Bureau Insurance is financially strong enough that this situation will not have any future impact on premiums or the financial interests of policyholders,” Canada added.
Canada said it appears from the information gathered during the investigation that Mr. Knecht began engaging in fraudulent activities in 1992. No other agent or employee of Indiana Farm Bureau was aware of his criminal behavior. In addition to identifying and working with victims, our audit also has provided information we have used to correct certain controls and institute enhanced processes to ensure that a similar situation does not occur again, the CEO explained.
“Mr. Knecht’s unethical behavior in no way exemplifies the business practices of so many of you who work with customers and assist them with sensitive financial transactions every day,” Canada said in his letter.
“We greatly appreciate the efforts of the U.S. Attorney’s office and the state and federal investigators. We have confidence that the process will result in a significant prison term and restitution and that Mr. Knecht will be held fully accountable for his actions,” Canada concluded.
Topics USA Fraud Agencies Agribusiness Canada
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