Grainnet

Chicago –Attorney General Lisa Madigan on July 1 announced that charges have been filed against the manager of a former Iroquois County grain elevator relating to his alleged unauthorized trading on the Commodities, Futures and Options Market.

Madigan charged Cameron Charles, manager of the former Watseka Farmers Grain Company Cooperative, with two counts of Violation of the Record Keeping Provision and one count of Destruction of Records, all Class 2 felonies punishable by three to seven years in the Illinois Department of Corrections (IDOC).

To cover up his fraudulent futures trading practices, Charles allegedly presented falsified records to the Illinois Department of Agriculture (IDOA) during a 2004 audit and destroyed records that he was required to keep for two years.

"Executives of companies cannot ‘cook the books’ to hide information during audits," Madigan said.

"Grain elevators are an integral part of the farming community, and my office will continue to ensure they are being operated in compliance with all state regulations."

"The investigation of Watseka Farmers Grain Company was a team effort, and the Illinois Department of Agriculture appreciates the cooperation of the Illinois Attorney General’s Office, the Commodity Futures Trading Commission and the Iroquois County State’s Attorney’s Office," IDOA Director Chuck Hartke said.

"These indictments demonstrate the department’s commitment to protect the interests of Illinois grain producers and ensure that those who abuse the public trust will not go unpunished."

As a grain elevator, Watseka Farmers Grain Company’s at-risk market position in the futures market is highly regulated by IDOA.

Strict limitations allow the company to have speculative positions in the futures market that do not exceed 25,000 bushels of soybeans.

However, Charles allegedly had in excess of 1,000,000 bushels of soybeans in speculative positions in the futures market, Madigan said.

Madigan said Charles allegedly presented IDOA with falsified documents to conceal that the elevator was outside its speculative limits, which would prevent it from passing an audit.

Charles also allegedly destroyed various records demanded by IDOA and associated with the operation of the elevator during the relevant time period.

As a result of Charles’ actions, the Watseka Farmers Grain Company’s license was suspended in May 2004 and the company was forced to close its doors.

Assistant Attorney General Peter Buh is handling the case for Madigan’s Trial Assistance Bureau.

The public is reminded that these charges are merely accusations and that the defendant is presumed innocent until proven guilty.

In March 2004, Madigan indicted two agri-business executives involved in the largest financial failure of a grain elevator operation in Illinois history.

John C. "Buzz" Gibbons and Kathleen L. Lestina pleaded guilty in late 2004 to charges associated with violations of the Illinois Grain Code.

Gibbons received a 10-year sentence and Lestino received a six-year sentence in IDOC.

The 2001 failure of Ty-Walk Liquid Sales Inc. grain elevator devastated hundreds of Illinois farmers and their families, drained the state’s grain insurance fund and left several financial institutions with unpaid loans totaling tens of millions of dollars.

See Related Websites/Articles:

• Illinois Department of Agriculture

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