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South Dakota businessman indicted in $71 million organics fraud
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South Dakota businessman indicted in $71 million organics fraud


Federal prosecutors have charged a South Dakota businessman in what they say was a $71 million scheme to sell fake organic grain and seeds to fuel his "extravagant lifestyle" which includes an $8 million yacht, a multimillion Florida home and luxury cars.

Kent Duane Anderson's "business enterprise generated large profits and he accumulated substantial wealth," U.S. Attorney Ron Parsons wrote in the 42-count, 17-page indictment. 

Anderson, 50, is indicted on one count of wire fraud conspiracy, 12 counts of wire fraud, and 29 counts of money laundering for allegedly using his network of South Dakota businesses to buy "thousands of tons" of non-organic grain and seed products and re-sell them as more expensive organic products. He allegedly committed the crimes between October 2012 and March 2018. 

If convicted, he faces up to 20 years on each count, or 840 years, plus possible fees and restitution. Anderson would also have to forfeit $27.3 million — which represents the amount of proceeds obtained as a result of the alleged crimes — and the luxury items he purchased with his fraudulent earnings. 

Anderson was indicted Feb. 4 in Sioux Falls and booked into the Pennington County Jail on Thursday after being arrested in the Rapid City area. Wearing his gray, striped jail uniform, he pleaded not guilty Friday at the federal court in Rapid City. All of his future court dates will be held at the federal court in Sioux Falls. 

Magistrate Judge Daneta Wollmann told Anderson that he doesn't qualify for a free public defender so if he doesn't hire a private attorney, he must pay a public defender $500 a month. Wollmann told Anderson she is letting him out of jail without bond because a report found he's not a flight risk or danger to society. 

Wollmann ordered Anderson to turn in his passport and not to discuss the allegations or defense strategy with his wife — who is the co-owner of his companies — but said he is free to travel between Florida, where he lives, and South Dakota, where his businesses are located, as long as he communicates with pre-trial services. 

Assistant U.S. Attorney Benjamin Patterson said he couldn't comment when asked about the risk of Anderson fleeing into international waters on his yacht, which is presumably docked in Florida. 

In 2005 Anderson formed the Bar Two Bar Ranch which sold cattle and hay from Belle Fourche, according to the indictment. The company later began selling grain, seeds and other products that became more profitable so Anderson created the Green Leaf Resources group of companies to handle that side of the business in 2008. 

Green Leaf Resource's main office is in Spearfish, according to the Secretary of State's website. The phone number listed on the company's website went straight to voicemail on Friday afternoon. 

The company markets “certified organic” flax and canola seeds, meal and oils. But the indictment says Anderson employed his sister-in-law and a college friend as “figurehead executives” who became certified organics handlers with the U.S. Department of Agriculture. He then used these certifications as “cover” to purchase non-organic products and resell them as organic.

Anderson purchased his non-organic products from two suppliers in Illinois and Minnesota, and had most of the products shipped to a warehouse in Tappen, North Dakota, the indictment says. Some products were sent to a processing facility he leased in Rapid City. An employee in North Dakota, who communicated with a worker in Florida, would replace the legal documents that said they were non-organic products with new documents certifying they were organic. The products were then shipped to wholesale distributors, brokers and other buyers who believed they had bought organic products.

The businesses made $71 million in fraudulent sales between October 2012 and December 2017, and Anderson pocketed $11 million into his personal bank accounts, according to the indictment. He used the money to pay for his $2.4 million Florida home, land in South Dakota, his 86-foot Italian yacht, a $250,000 sports boat and more than $400,000 in jewelry from the U.S. Virgin Islands. He also bought a Maserati convertible, a Jaguar SUV and three Range Rover SUVs. 

Questions about Anderson’s operation began arising last year. The state’s Public Utilities Commission investigated a business owned by Anderson after receiving complaints that it was not making payments and had purchased grain without the required license. Anderson’s company didn't respond to inquiries and requests to conduct an inspection, according to a March statement from the Public Utilities Commission.

Stephen Groves of the Associated Press contributed to this story.

— Contact Arielle Zionts at

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