LINCOLN - A $71 million fraud case in South Dakota is the latest blow to the organic supply chain. Federal prosecutors in February accused Kent Duane Anderson, a Rapid City businessman, of passing off conventional grain and seed as organic for more than five years.Anderson pleaded not guilty to charges of wire fraud and money laundering.

The case is the second large-scale organic fraud case in the Midwest to attract federal prosecution in less than a year and comes amid ongoing concern over fraudulent organic imports. The South Dakota case is frustrating but unfortunately not a surprise, said Erin Heitkamp, a vice president at Pipeline Foods, a Minneapolis-based organic supply-chain company. Her firm has reported concerns, often about middlemen such as Anderson buying and selling grain from a desk, to certifiers and government regulators.

“There will likely be more investigations and prosecutions,” Heitkamp said. “I expect to see more and more shoes drop over time.”

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