By: April Carson
A rancher in Washington state was sentenced to 11 years in prison for defrauding Tyson Foods Inc. of nearly $250 million by selling the company more than 260,000 head of cattle that didn't exist.
Cody Easterday, 51, of Mesa, Wash., is accused of running a "ghost cattle" scam for more than four years to conceal $200 million in futures trading losses. “The sheer size of Easterday's fraud is staggering," federal authorities wrote in court filings. “Easterday plundered $244 million that would have lasted the combined police, courts, and fire budget of Yakima — a city with a population of almost 100,000 people – for approximately four years.”
Easterday owned and operated two cattle-feeding operations in Washington state, Easterday Ranches and Easterday Farms. He also served as the chairman of the National Cattlemen's Beef Association from 2002 to 2003.
According to criminal complaint, Easterday began working with Tyson in 2016, agreeing to buy and feed cattle on the company's behalf until they were ready for slaughter.
Easterbay will purchase and feed the cattle with money provided by Tyson, who will be repaid with interest when the animals are sold. The difference in price between what is owed to Tyson and the final sale price will be Easterbay's profit, as stated in court documents.
However, between November 2016 and April 2019, Easterday allegedly began submitting false invoices to Tyson for cattle that he never purchased. He would then pocket the difference between the amount he was paid by Tyson and the amount he actually spent on feed and other expenses.
Over the course of four years, prosecutors claim that Easterday submitted invoices to Tyson for over $2 billion in cattle. But this may not be true because investigators say that Easterday created inflation by adding what are called ghost cattle, or animals that don’t actually exist, onto the bill by 10%.
Prosecutors charged: "Easterday never purchased the cattle. Rather, Easterday betrayed his victims' trust and diverted a substantial portion of the proceeds of his fraud to cover significant losses he incurred while speculating in commodity futures contracts irresponsibly."
In 2020, Easterday went into a similar agreement with a lesser-known firm in Washington, according to authorities. In all, he embezzled $233 million from Tyson and $11 million from the smaller organization, according to prosecutors.
In 2020, when Tyson became suspicious, he requested for a comprehensive inventory of the cattle Easterday claimed to have acquired for him. He acknowledged that he had been defrauding the business, according to prosecutors.
Tyson was contacted for input, but they elected not to respond.
In March 2021, Easterday was charged with federal wire fraud and pleaded guilty a month later. According to his attorney, Easterday had created a firm that generated $250 million in revenue each year but had an online gambling addiction that drove him to make increasingly hazardous commodity trades, putting him into a severe financial deficit.
On June 2, 2021, he was sentenced to 11 years in prison and ordered to pay $217.7 million in restitution.
In addition, the family's wealth skyrocketed when John Easterday began trading cattle futures as a hedge against market fluctuations in 2010. However, as his father grew sick and withdrew from management, he took riskier wagers. His father was killed in a vehicle accident in 2020.
Oreskovich stated that the younger Easterday had helped a multitude of people while building a successful business. Though, he got caught in a difficult business scenario and made choices about how to get out which were not ideal. He went on to explain that large amounts of money are constantly being exchanged in this type of business; therefore, if you lose, you lose a great deal.
After confessing his actions, Easterday sold his farm to repay Tyson and the other company he deceived. He also agreed to never again work with livestock.
Although prosecutors state that Tyson is owed approximately $170 million, reconciliation may be difficult.
"It will be very difficult, if not impossible, to ever fully reimburse Tyson or the other company," said U.S. Attorney for the Western District of Missouri Tim Garrison. "It's not like he has $170 million sitting in a bank account somewhere."
Easterday's lawyer, Kevin Hunley, said that his client is "extremely remorseful for what he did and the people it affected."
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About the Blogger:
April Carson is the daughter of Billy Carson. She received her bachelor's degree in Social Sciences from Jacksonville University, where she was also on the Women's Basketball team. She now has a successful clothing company that specializes in organic baby clothes and other items. Take a look at their most popular fall fashions on bossbabymav.com
To read more of April's blogs, check out her website! She publishes new blogs on a daily basis, including the most helpful mommy advice and baby care tips! Follow on IG @bossbabymav
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