A man who misrepresented chemical fertilizer as organic has pleaded guilty in federal court, according to the U.S. Attorney’s Office for the Northern District of California.
Peter Townsley, owner of California Liquid Fertilizer in the Salinas Valley, admitted to defrauding his organic farmer customers by saying his fertilizer, Biolizer XN, was approved for use in organic agriculture when it actually contained chemicals prohibited in organic crop production.
As part of the U.S. Department of Agriculture Office and Inspection General’s effort to crack down on fraud and corruption in the more than $24 billion organic industry, the case was prosecuted by the Special Prosecutions and National Security Unit of the U.S. Attorney’s Office in San Francisco, which acknowledged the “significant effort” to investigate the matter
by the California Department of Food and Agriculture.
From April 2000 to December 2006, the U.S. Attorney’s office said in a news release, Townsley’s company took in more than $6.5 million in gross sales of Biolizer XN.
According to the plea agreement, Townsley successfully applied for Organic Material Review Institute (OMRI) approval of Biolizer XN in 1998, claiming the fertilzer was made of fish, fish by-products, feathermeal and water. By April 2000, however, he reformulated the ingredients to include a product containing ammonium chloride, which is not allowed in organic farming, and did not disclose this change.
By June 2001, he changed the product again to include ammonium sulfate, another prohibited ingredient, but continued to claim the fertilizer was OMRI-approved.
Townsley “admitted that he knew these representations to organic farmers were false when he made them and that by deceiving his customers, he was able to ensure continued sales of Biolizer XN to organic farmers,” the U.S. attorney said.
Townsley, 50, was originally indicted by a federal grand jury on June 1, 2010. In pleading guilty to two counts of mail fraud, based on his mailing renewal certifications to OMRI in 2005 and 2006, he faces up to 20 years imprisonment, a $250,000 fine, three years of supervised release, and a $100 special assessment.
Sentencing is scheduled for June 13, 2012.