North Dakota farmers sentenced to prison for insurance fraud
Mar. 10, 2015
FARGO, N.D. (AP) — Two North Dakota brothers were sentenced Monday to prison time and ordered to pay back more than $900,000 for intentionally destroying potatoes to collect federal farm insurance payments.
In separate hearings, U.S. District Judge Ralph Erickson sentenced Aaron Johnson to four years in prison and Derek Johnson to 1½ years in prison. A jury in December convicted the pair of conspiring to receive illegal payments and giving false statements.
Prosecutors accused the brothers of adding spoiled and frozen potatoes to their stored crop and using portable heaters to make the potatoes deteriorate faster. The defendants found that the best way to wreck the crop was using Rid-X, a chemical that's designed to dissolve solid materials in septic systems, prosecutors said.
Erickson said the brothers need to serve prison time to reflect the seriousness of the crime and deter others from similar conduct.
"This was a crime of dishonesty," Erickson said during Aaron Johnson's sentencing, which was held first. "It defrauded the taxpayers of the United States."
Erickson ordered the Johnsons, who farmed near Cooperstown, to pay back the government $932,776. The judge determined the government could prove fraud only for the 2006 growing season.
Both Somah Yarney, Aaron Johnson's attorney, and Benjamin Thomas, Derek Johnson's attorney, appealed for leniency based on their ability to pay restitution if they weren't incarcerated and their value to their families and communities. Thomas said Derek Johnson lost his job, his house and may lose his wife and children because they now live in British Columbia and Johnson will likely be barred from returning to Canada.
"His punishment is real. And it has already occurred," Thomas said.
Yarney noted that Aaron Johnson donated potatoes to schools, senior centers and churches to help Northwood recover from a 2007 tornado that wiped out much of the town. She said a sentence of probation would help his effort to pay back the government.
Yarney successfully argued that the government could not show illegal payments in 2002-05.
Thomas argued that Aaron Johnson was more culpable than Derek in the conspiracy. Aaron Johnson, Thomas said, made most of the decisions without Derek's knowledge.
"If anything, Aaron was managing Derek in this enterprise," Thomas said. "Derek was managing nobody."
Both brothers asked to serve their sentences in Duluth, Minnesota.