California Central Valley fruit broker Ralph Hackett pleaded guilty August 9 to aiding and abetting mail fraud and agreed to pay $650,000 in criminal restitution for helping another individual submit a fraudulent crop insurance claim for table grapes.
According to the U.S. Department of Justice, in a civil settlement with the U.S., Hackett also agreed to pay another $605,000 to resolve allegations of crop insurance fraud for the crop years 2012 through 2015.
Hackett is a former managing member of Dayka & Hackett BB #:189566, but the lawsuit does not refer to that company by name.
Tim Dayka told Blue Book Services that Dayka & Hackett had nothing to do with the fraudulent crop insurance claims and that Hackett has retired from Dayka & Hackett and is no longer active in the business.
In June, Dayka & Hackett LLC, along with Agrícola Don Ricardo, Ica, Peru, sold majority ownership to newly-formed produce company Frutura, whose founding CEO is David Krause, who most recently spent two decades as president of The Wonderful Company’s citrus operation.
The deal was finalized in late July.
The Justice Department provided the following background and links to court documents on the Hackett case:
According to court documents, Hackett was a member and manager of a Central Valley fruit broker through which the other individual sold various crops, including table grapes, from the individual’s farming operation in Fresno and Tulare counties.
At the other individual’s request, Hackett instructed one of his employees to provide altered records to the individual that underreported the amount of table grapes the individual sold through the fruit broker so the individual could submit a fraudulent crop insurance claim for the grapes for the crop year 2013. Hackett then instructed the same employee to falsely confirm the accuracy of the altered records when the insurance company called for verification.
Hackett further acknowledged that he helped the other individual submit additional fraudulent crop insurance claims for the crop years 2012 through 2015 and, all together, caused more than $650,000 in fraudulent insurance payments to be made to the individual’s farming operation.
The insurance payments were federally backed by the Federal Crop Insurance Corporation (FCIC) and were made by checks sent through the mail. The civil settlement resolves claims that Hackett violated the False Claims Act and the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) during those years.
The False Claims Act allows the government to recover damages and penalties for the presentation of false claims for payment to the United States. FIRREA allows the government to impose civil penalties for violations of enumerated federal criminal statutes, including fraud on the FCIC.
This case is the product of an investigation by the United States Department of Agriculture’s Office of the Inspector General and Risk Management Agency Special Investigations Staff. Assistant U.S. Attorney Joseph Barton is prosecuting the criminal case and Assistant U.S. Attorney Matthew R. Belz handled the civil investigation.
Hackett is scheduled to be sentenced by U.S. District Judge Dale A. Drozd on Feb. 22, 2022. Hackett faces a maximum statutory penalty of 20 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account several variables.
