ADM accused of directing grain sales ponzi scheme

A Missouri grain dealer who stole tens of millions of dollars from farmers may turn out to be their best ally as they try to recoup losses from corn giant Archer-Daniels-Midland Co.

ADM began trial Tuesday in St. Louis with farmers claiming the woman couldn’t have ripped them off without help from the world’s biggest corn processor. From behind bars, where she is serving a nine-year sentence, the dealer’s testimony is set to bolster the farmers’ effort to get back more than just the mere fraction of their losses they’ve recovered from her.

The farmers allege in their lawsuit that Cathy Gieseker, who the farmers say was ADM’s top grain supplier at its facility in Mexico, Mo., was acting as an agent of ADM and the company is “vicariously liable” for their losses. In deposition testimony, she “testified that ADM instructed her and directed all her activities that involved the grain fraud,” lawyers for the farmers said in a court filing.

ADM has been investigated by multiple agencies, including the U.S. Justice Department and the Missouri attorney general’s office and no wrongdoing has been found, said Lori Cohen, an attorney for ADM.

An unfavorable verdict for ADM could taint a mainstay of U.S. agriculture, an industry built largely on relationships farmers have forged over generations with companies that buy their crops and sell them insurance, hedging services, fertilizer and tractors. Farmers across the American corn belt sell their harvests to ADM, or store supplies in its massive bins, before the commodities make their way through a network of grain elevators, barges and ports to markets around the world.

Read more: Bloomberg


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