A South Dakota man has been indicted in federal court on allegations that he was marketing conventional agricultural products as organic for at least five years and using the proceeds to propel him to an extravagant lifestyle of yachts, jewelry and fancy vehicles in a Florida mansion. But public records in North Dakota and South Dakota show that Kent Duane Anderson may have been skirting grain trading regulations and failing to pay farmers and grain elevators since at least 2006.
A federal grand jury on Feb. 4 indicted Anderson on 42 counts for the alleged scheme — one of conspiracy to commit wire fraud, 12 of wire fraud, 12 of monetary transactions to promote unlawful activity and 17 of monetary transactions in criminally derived property.
In February, Anderson pleaded not guilty to the charges. If convicted, Anderson could face prison time and could be forced to forfeit any property related to the offenses, as well as more than $27 million.
U.S. Magistrate Judge Daneta Wollmann ordered Anderson released from jail pending future court proceedings.
From Oct. 1, 2012, to March 14, 2018, Anderson is accused of purchasing $47 million in grain from his business accounts, of which $46 million was for non-organic products. In the same time frame, the businesses sold $75 million in products. Of that $75 million, 95%, or $71 million, was for sales of non-organic products falsely labeled “organic,” federal prosecutors allege.
Buying conventional, selling organic
The Andersons, documents say, registered a variety of businesses since 2005, including Bar Two Bar Ranch LLC, Green Leaf Resources Inc., Green Leaf Industries LLC, Green Leaf Commodities LLC, Green Leaf Trading LLC and Green Leaf Oils LLC. The Green Leaf entities were involved in organic grain marketing. Regulators in South Dakota said during a hearing in 2019 that they may have been involved in more entities than that, but all of them seemed to have been operating as the same business.
According to the indictment, the scheme would function as such:
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Anderson’s companies would purchase mostly non-organic grain from elevators in the region.
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Products purchased by Anderson’s companies mostly were shipped to the Tappen facility, though a small portion also went to a processing facility in Rapid City. B.M. would unload the products into storage bins.
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The products shipped to Tappen were accompanied by bills of loading that reported the products were not organic and were shipped from non-organic suppliers.
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M.G. would receive purchase orders from customers at an office in Florida.
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Another employee in Florida, identified as “R.M., would arrange shipments of products, including bills of lading and invoices, falsely reporting the products as organic. R.M. would tell B.M. what products and quantities to load for and ship to Anderson’s customers. R.M. would prepare and email to B.M. bills of lading and invoices that reported the products were organic to accompany the outgoing shipments.
From October 2012 to December 2017, the indictment says, approximately $11 million was transferred to Anderson’s personal bank accounts. The money went toward purchases, including an $8 million yacht, a $250,000 sports boat, a $2.4 million home in Florida, more than $400,000 in jewellery and multiple expensive personal vehicles, including a Maserati Gran Turismo, Range Rover Autobiography, Range Rover Sports and a Jaguar F-Pace SUV.
Federal public defenders Jason Tupman and Thomas Diggins were appointed to represent Anderson. However, Wollmann, the magistrate judge, found during the Feb. 14 court hearing that Anderson “has the financial ability to make partial payment for the representation provided by court-appointed counsel, including costs and expenses incident thereto” and ordered him to pay $500 each month toward legal services rendered by court-appointed counsel.
No other court proceedings have been scheduled.
