Two former top investigators for Farm Bureau Financial Services are suing the company for fraud, racketeering and wrongful termination.
The lawsuit alleges the insurer’s management group knew of fraudulent activity committed by company employ
ees and refused to report fraud to state regulators. The purpose of the scheme was to pass on the bulk of the financial costs of some fraudulent claims o
r illegal activities to policyholders and other competitors, the lawsuit alleges.
The lawsuit claims Farm Bureau Financial committed racketeering, obstruction of justice, and mail fraud or wire fraud.
The lawsuit, filed by James Newton and Brent Meskimen on Nov. 15 in Iowa district court, alleges the insurer’
s management group was repeatedly informed of fraudulent acts carried out by Farm Bureau adjusters and agents.
Newton and Meskimen said they were terminated separately in Novem
ber 2023 after saying they would submit reports of fraudulent activity to state regulators even if it went against supervisors’ orders.
Newton worked 13 years at Farm Bureau, rising to director of investiga
tions. Meskimen managed the special investigations unit for the Farm Bureau’s Property & Casualty Insurance Company.
Farm Bureau Financial is a West Des Moines-based insurer that provides auto, home, life and property insuranc
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e. Farm Bureau did not respond to a request for comment.
Lawsuit: Farm Bureau Kept Fraudulent Activity Hidden
Farm Bureau’s special investigations unit (SIU) revealed fraudulent activities by company employees as far
back as 2011, the pair allege, but senior management repeatedly kept state regulators in the dark.
According to the lawsuit, there were multiple instances of emp
loyees committing forgery, including one case of a Kansas agent allegedly forging at least 900 forms for his clients, allegedly with the clients’ consent, and another 100 f
orms without clients’ consent. The agent was terminated, but no management refused to refer the incident to the Kansas Department of Insurance Fraud Unit.
In another instance, the special investigation unit found that an Iowa agent allegedly altered coverage for a loss
after a client’s 1991 Ford Mustang was destroyed in a fire. The insured of the Ford Mustang was the agent’s father, the lawsuit claims.
Newton allegedly stressed to his superior that the incident needed to be referred to the Iowa Department of Insurance Fraud Unit. Newton was told the agent woul
dn’t be disciplined and that the claim would be paid out of Farm Bureau’s “slush” fund via an Errors & Omissions claim, according to the lawsuit.