Albert Lea insurance agent Reid Nelson, already facing felony theft charges for nearly $32,000 he allegedly took from an apartment complex account he managed, now faces an insurance fraud charge and an aggravated forgery charge.

Both are felonies. He appeared before a judge in Freeborn County District Court to face the charges on Wednesday.

An Albert Lea Police Department investigation says Albert Lea residents Brad and Nancy Wright hired Lembke Construction to build a structure named the Pelican Pointe Condominiums. The construction company believed its contractor’s liability was insured through Strong Agency, for which Nelson is an agent. It made payments to Strong Agency and received insurance certificates claiming to be from Harleysville Insurance.

However, there was a problem with the construction, the investigation says.

Lembke Construction filed a claim, only to have Nelson reportedly call company owner Doug Lembke and say Harleysville Insurance denied the claim.

The Wrights asked Lembke to file the claim again. Lembke contacted Nelson again. The police investigation alleges that during this conversation Nelson told Lembke he had allowed the policy to lapse in 2003 and had given the construction company fake certificates.

Lembke also contacted Harleysville Insurance, headquartered in Harleysville, Pa. He received a letter saying Nelson was not an agent for Harleysville Insurance and saying there never was an insurance policy for Lembke Construction.

Lembke told police that Nelson, on two occasions, told Lembke he would cover the expenses to repair the condominiums, even if it meant refinancing his house. He said Nelson acknowledged Strong Agency’s liability in the situation.

Lembke went ahead and made $50,000 in repairs; however, Strong Agency never reimbursed the sum, the investigation states.

Police, with the assistance of the Minnesota Division of Insurance Fraud Prevention, on Tuesday executed search warrants on Strong Agency, Nelson’s home and the home of Nelson’s sister, Deb Stolarcek, who also is an agent at Strong Agency.

Nelson and Stolarcek were arrested Tuesday and stayed in the county jail. Their father, Strong Agency owner Roger Nelson, was brought to the police station for questioning but not arrested.

Stolarcek was released from jail Wednesday with no charges filed. Reid Nelson posted $40,000 bail and agreed to conditions, including having no contact with Lembke or the Wrights. His next court appearance is 1 p.m. July 6.

Also, the judge ordered four bank accounts frozen.

Further charges in the case could be filed pending continued investigation.

The Steele County Attorney’s Office is prosecuting the case because Reid Nelson is the brother of the Freeborn County attorney, which presents a conflict.

Reid Nelson also faces five felony counts of theft and one gross misdemeanor count of theft in relation to an investigation that alleges he took more than $30,000 from the former owners of the Town House Apartments on College Street.

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