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An 88-year-old farmer from Albion faces the possibility of a federal prison term after pleading guilty to defrauding a U.S. Agriculture Department program out of $384,000.

Peter Dragan will become one of the oldest people in the region to be incarcerated if a judge follows federal sentencing guidelines that dictate a prison term of 18 to 24 months, authorities said Monday.

Dragan, wearing thick glasses, a hearing aid and casual farm clothes, pleaded guilty to a felony count of illegal conversion of property he had pledged as collateral for two loans.

"Yes, we are aware of his age, but he was almost that age when he committed the crime," Assistant U.S. Attorney John E. Rogowski said. "The government can't give the elderly a free pass to commit a crime."

Prosecutors said Dragan twice defrauded the Federal Commodity Credit Corporation, an agency of the Agriculture Department that extends price support loans to struggling farmers.

In November 2001, the government gave Dragan a loan of more than $233,000, and Dragan put up 43,373 bushels of soybeans as collateral. Dragan agreed to pay off the loan when he sold the soybeans.

"Then, in 2002, he sold the soybeans (for $341,477) and kept the money, instead of repaying the loan," Rogowski said.

Dragan admitted doing the same thing on another $151,000 loan that he received from the same program, this time using his wheat crop as collateral.

His attorney, Karl Salzar of Rochester, described Dragan as a hard-working widower who is genuinely apologetic for his actions.

"He readily admits his guilt. He didn't plan to cheat the government. He's working on a bankruptcy plan that would enable him to repay the government," Salzar said. "This is an 88-year-old man who still goes out and works the fields every day. He's in better shape than I am."

The felony admitted by Dragan carries a maximum prison term of five years, but sentencing guidelines prescribe a sentence of 18 to 24 months, in part because Dragan has no previous criminal record.

District Judge William M. Skretny plans to sentence Dragan on Feb. 15. Judges usually sentence within the guideline range, but Salzar hopes Skretny will depart from the guidelines and give Dragan time in a halfway house, home confinement, probation or some other punishment.


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