News

Another farmer convicted in $140 million scheme to sell fake organic grain

Faces up to 5 years in federal prison

(Dreamstime/TNS)
(Dreamstime/TNS)

CEDAR RAPIDS — A fifth farmer involved in nearly $140 million scheme to sell fake organic grain was convicted last week in federal court.

John Burton, 52, of Clarksdale, Mo., pleaded guilty Friday in U.S. District Court to one count of conspiracy to commit wire fraud. As part of the scheme, which started in January 2010 and continued through 2017, he admitted that grain grown on non-organic fields was marketed and sold as organic and that unapproved substances were used on fields certified as organic.

Burton sold non-organic grain to Randy Constant, 61, of Chillicothe, Mo., who would sell the grain through his brokerage, Jericho Solutions, in Ossian, Iowa, according to court documents. Constant was convicted in December. Both he and Burton knew the grain was grown in non-organic fields or grown with unapproved substances.

Constant was convicted of one count of wire fraud. He admitted the fraudulent scheme involved at least $142.43 million in grain sales, and the majority of those sales were fraudulent, according to court documents.

Court documents show one wire payment of $419,418 from a customer in Sonora, Calif.

Prosecutors usually don’t include every incident of wire fraud in the charging information.

Constant made many of the fraudulent sales through Jericho Solutions, which he co-owned and operated primarily out of Ossian in Winneshiek County in northeast Iowa, according to court documents.

The grain labeled as organic was sold to customers nationwide, the complaint shows.

Constant also forfeited $128.19 million in proceeds as part of his plea agreement.

In related cases, three farmers from Nebraska were previously convicted of fraud involving sales of grain fraudulently marketed as organic, according to court documents. Each of the farmers received more than $2.5 million from sales of the fraudulent grain.

Constant and the three other farmers, Tom Brennan, James Brennan and Mike Potter will be sentenced Aug. 16.

Burton faces up to five years in prison and a fine of $250,000. His sentencing hasn’t been set.

The case is being prosecuted by Assistant U.S. attorneys Jake Schunk and Tony Morfitt, and investigated by the U.S. Department of Agriculture — Office of Inspector General and the Federal Bureau of Investigation. • Comments: (319) 398-8318; trish.mehaffey@thegazette.com