Farmers to plead guilty in organic grain fraud scheme
Three Nebraska farmers will plead guilty to knowingly marketing non-organic corn and soybeans as certified organic as part of a lengthy, multimilliondollar fraud scheme, U.S. 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 Friday in federal court in Cedar Rapids, Iowa.
Prosecutors allege the three conspired with the owner of a large Iowa-based company to dupe customers across the U.S. 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 (USDA) 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 coconspirator. 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. Organic grain was mixed with non-organic grain, rendering all of it non-organic.
Court documents indicate the Brennans and Potter are co-operating, signalling that additional charges might be forthcoming against the owner of “J.S..”
Prosecutors said in court documents the certification for the Nebraska farm was owned by “J.S.” and would have been revoked had its third-party certifier known of the chemicals that were used.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 reply to messages.