Washington Potato Farmers, processors plead innocent to insurance fraud charges

Four Eastern Washington potato farmers and processors pleaded innocent Feb. 7 to federal conspiracy charges alleging that they illegally received nearly $9.6 million in crop insurance payments.

A grand jury Jan. 11 indicted Lynn J. Olsen II of Pasco, Wash., Mark G. Peterson of Richland, Wash., Blake T. Bennett of Pasco, Jeffrey J. Gordon of Pasco, Olsen Ag, Inc., Poco LLC and Tri-Cities Produce Inc., according to the indictment filed in the U.S. District Court of Eastern Washington.

They allegedly sold Norkotah Russet potatoes to the buyers for processing rather than fresh pack, even though the variety is not usually suitable for processing. The contracts called for "exceedingly high"requirements even for potatoes typically used in processing, according to the indictment.

After the potatoes failed to meet the standards of the contracts, the buyers would allegedly pay the farmers only a fraction of the fresh pack market value. The farmers allegedly received crop insurance payments "to which they were not entitled,"according to the indictment, totaling roughly $9.57 million.