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Justice News

Department of Justice
U.S. Attorney’s Office
District of South Dakota

Friday, November 25, 2016

Man Serving Time in Prison Agrees to Pay Civil Penalties for Submitting False Claims After 2013 Storm “Atlas”

United States Attorney Randolph Seiler announces that Karl Knutson, age 28, currently serving time in prison for making false claims to the U.S. Department of Agriculture Farm Service Agency Livestock Indemnity Program for cattle lost during the October 2013 winter storm Atlas, has agreed to settle the civil claims associated with his conduct.  Knutson recently reached an agreement with the government wherein he will pay $15,000 in civil penalties for his violations of the False Claims Act.

The False Claims Act, (31 U.S.C. § 3729) imposes a civil penalty of not less than $5,500 and not more than $11,000 for each false claim, plus three times the amount of damages which the government sustained, on persons who knowingly submit false claims to the government. Earlier this year, Knutson admitted to knowingly submitting false claims, claiming to have lost 129 head of cattle during the storm, knowing he had only lost no more than 13, and was sentenced (on the criminal charge) to 12 months of imprisonment, followed by 3 years of supervised release, ordered to pay a $100 special assessment to the Federal Crime Victims Fund, and a fine of $7,380.04.  The settlement agreement resolves the civil liability for his conduct. 

The United States Attorney’s Office places a high priority on both criminal and civil enforcement in cases involving all types of fraud committed against the government, and works with various law enforcement agencies to identify and investigate these matters. The investigation in this case was conducted by the U.S. Department of Agriculture, Office of Inspector General (OIG).  Assistant United States Attorneys Benjamin Patterson and Cheryl Schrempp DuPris prosecuted the criminal and civil cases respectively.

Updated November 25, 2016