ND brothers accused of intentionally spoiling potatoes so they could collect disaster payments

FARGO, N.D. – Two brothers who operated a North Dakota potato farm are accused in federal court of intentionally spoiling potatoes after the 2006 harvest in order to collect disaster payments.

Aaron Johnson, 50, and Derek Johnson, 47, along with their company, Johnson Potato, are charged with conspiracy and making false statements. The government said in documents released Wednesday that the Johnsons received more than $800,000 in federal crop disaster payments for which they were not entitled.

Alexander Reichert, a lawyer for Aaron Johnson, and U.S. Attorney Timothy Purdon declined comment Thursday. Court documents do not list an attorney for Derek Johnson.

Authorities said the brothers raised irrigated potatoes near Cooperstown, in central North Dakota, and following the harvest stored the crop in a nearby warehouse rather than sell them. Court documents do not show the amount of potatoes involved or say how much the brothers could have made if they had sold them.

The defendants allegedly applied chemicals, including a substance known as "Rid-X" that's designed to dissolve solid materials in septic systems, and added spoiled and frozen potatoes to their stored crop. That caused the potatoes to rot, investigators said.

"There is not a legitimate farming reason to apply frozen and already-spoiled potatoes to stored potatoes," the indictment reads.

Investigators said the brothers also used portable heaters to warm the warehouse above 80 degrees and make the potatoes deteriorate faster.

Once the potatoes rotted, prosecutors said, the Johnsons reported the loss to their insurance company and said the crop was lost due to naturally caused diseases. The brothers are accused in the course of the alleged scheme of making false statements to law enforcement and agencies within the U.S. Department of Agriculture.

Federal crop insurance covers setbacks only for a "naturally occurring event" and does not cover losses due to negligence, mismanagement, or wrongdoing.

Arraignment is scheduled Feb. 20 for Derek Johnson and Feb. 26 for Aaron Johnson.