Minneapolis, MN (KROC-AM News) - A southern Minnesota farmer has been sentenced to just over a year in federal prison and has been ordered to pay over $880,000 in restitution for a fraud-related conviction.

41-year-old Daniel Kluender of Walters earlier pleaded guilty to illegally selling hundreds of thousands of dollars in property that was pledged as collateral for a US Department of Agriculture-backed farm loan. Court records indicate the Faribault County man took out a $1.3 million loan from Farmers State Bank in Albert Lea that was guaranteed by the federal Farm Service Agency, and then sold property pledged as collateral and retained the proceeds for his personal use rather than pay off the loan.

Federal officials say Kluender also filed for Chapter 7 bankruptcy during which he provided false testimony about the collateral for the loan. He was also accused of using physical violence against a bank employee and vandalized some of thee pledged collateral when Farmers State Bank moved to repossess the property to satisfy the loan.

Just under $315,000 of the restitution ordered by the federal judge in the case will be directed to the bank and the remainder, which is over $566,000, is owed to the US Department of Agriculture.

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