Farm­ers to plead guilty in or­ganic grain fraud case

Lethbridge Herald - - BUSINESS AGRICULTURE -

Three Ne­braska farm­ers will plead guilty to know­ingly mar­ket­ing nonor­ganic corn and soy­beans as cer­ti­fied or­ganic as part of a lengthy, mul­ti­mil­lion-dol­lar fraud scheme, fed­eral pros­e­cu­tors re­vealed Thurs­day.

Tom Bren­nan, his son James Bren­nan and fam­ily friend Michael Pot­ter have each agreed to plead guilty to one count of wire fraud. Their plea hear­ings are sched­uled for to­day in fed­eral court in Cedar Rapids, Iowa.

Pros­e­cu­tors al­lege that the three con­spired with the owner of a large Iowa-based com­pany to dupe cus­tomers na­tion­wide who thought they were buy­ing grains that had been grown us­ing en­vi­ron­men­tally sus­tain­able prac­tices.

All three op­er­ated an or­ganic farm in Over­ton, Ne­braska, that was cer­ti­fied through the U.S. De­part­ment of Agri­cul­ture’s Na­tional Or­ganic Pro­gram, which re­quires crops to be grown with­out the use of fer­til­iz­ers, sewage sludge and other sub­stances. They also farmed other fields that weren’t cer­ti­fied.

From 2010 through 2017, the trio sold non-or­ganic grain di­rectly to cus­tomers and to an Os­sian, Iowa-based com­pany, which is iden­ti­fied in court pa­pers only as “J.S.” and as be­ing owned by an uniden­ti­fied co-con­spir­a­tor. They knew the grain was mostly non-or­ganic be­cause it came from non-cer­ti­fied fields or from cer­ti­fied fields where they ap­plied pes­ti­cides and ni­tro­gen in vi­o­la­tion of USDA stan­dards, pros­e­cu­tors con­tend in court doc­u­ments. Any or­ganic grain was mixed with non-or­ganic grain, ren­der­ing all of it non-or­ganic.

Court doc­u­ments in­di­cate that the Bren­nans and Pot­ter are co-op­er­at­ing, sig­nalling that ad­di­tional charges may be forth­com­ing against the owner of “J.S.” Pros­e­cu­tors said in court doc­u­ments that the cer­ti­fi­ca­tion for the Ne­braska farm was owned by “J.S.” and would have been re­voked had its third­party cer­ti­fier known of the chem­i­cals that were used.

Holly Lo­gan, an at­tor­ney for James Bren­nan, de­clined to com­ment. USDA records show that he vol­un­tar­ily sur­ren­dered an or­ganic cer­ti­fi­ca­tion last month. At­tor­neys for the other two de­fen­dants didn’t im­me­di­ately re­ply to mes­sages.

The charges were praised by the Cornucopia In­sti­tute, an or­ganic in­dus­try watch­dog group that has been crit­i­cal of the USDA for be­ing too le­nient with pro­duc­ers who vi­o­late its stan­dards.

Vi­o­la­tions are typ­i­cally han­dled through USDA en­force­ment ac­tion that can bring fines, re­vo­ca­tions and bans, and fed­eral crim­i­nal charges are rare, said the group’s di­rec­tor, Mark Kas­tel.

He said the prose­cu­tion will send a mes­sage to farm­ers who may have the op­por­tu­nity to profit by de­fraud­ing the grow­ing or­ganic mar­ket.

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