Insurance Co. Owner Pleads Guilty to Stealing $1.8M

Dennis Pap admitted in federal court to stealing approximately $1.8 million from two entities for which his firm provided agricultural insurance services.

Dennis Lee Pap pleaded guilty on Friday to one count of wire fraud in connection to a crime through which he stole approximately $1.8 million from clients of his insurance firm, according to the U.S. Attorney's Office in Minnesota.

Pap, a 43-year-old man from Lynden, Washington, was the owner and CEO of now-defunct Parthenon Risk Partners-which provided insurance services to agricultural cooperatives in Minnesota.

Parthenon, which was founded in 2004, also helped manage the insurance needs of Access Insurance Association and Pillar Insurance Limited, including the handling of premium contributions from clients and the return of surplus premiums to agricultural businesses.

Court documents indicate that Access Insurance Association is a Minnesota-based organization formed to provide workers' compensation insurance coverage to agricultural businesses located in Minnesota.

Pillar Insurance Limited is a property and liability reinsurance company based in the Cayman Islands, and it provided coverage to Minnesota's agricultural businesses.

In his plea agreement, Pap admitted that between July 2008 and December 2009 he stole nearly $2 million from the two organizations through Parthenon and deposited the funds into his personal bank account.

Prosecutors allege that while Pap was diverting the funds for his personal use, he misrepresented the financial condition of the organizations and concealed his actions from the entities' board members.

Pap faces a maximum penalty of 20 years in prison for his crime. A hearing has not yet been scheduled to determine his sentence.