Cody Easterday $244M fraud called staggering
But his lawyer said that sum reflected the scale of his cattle business.
Easterday, 51, was given a prison term Oct. 4 in Yakima, Wash., based on standardized sentencing guidelines. Even without prior convictions, Easterday was subject to a long sentence because the $244 million he stole pushed up his offender score.
Defense attorney Carl Oreskovich did not dispute the Justice Department's calculation. But, seeking leniency, he asked the court to consider other factors, including the size of Easterday's transactions with Tyson Fresh Meats.
Over the previous decade, Easterday and Tyson had done $2 billion worth of business. On one day alone, Easterday billed Tyson $5.3 million to care for 6,312 head of "phantom" cattle.
Easterday wasn't greedy or living lavishly; he was in a hole and trying to gamble his way out, Oreskovich said. "It's easy to understand why the loss was as large as it was."
Easterday pleaded guilty last year to taking $233 million from Tyson and another $11 million from Segale Properties of Tukwila, Wash., a real estate developer that invested in cattle.
After helping sell his farms and feedlots in bankruptcy court, Easterday returned to court for sentencing. Oreskovich pleaded for home detention.
Otherwise exemplary throughout his life, Easterday was taken down by an addiction to gambling on the future prices of commodities, Oreskovich said.
Afterward, he said Judge Stanley Bastian's sentence was harsh. Easterday walked briskly past reporters, free until he self-reports to prison officials. His family and friends, who packed the courtroom in silent support, quietly and slowly filed out.
Bastian said it was the largest fraud case he had ever seen, or hoped to see. He asked John "Fritz" Scanlon, assistant chief of the Justice Department's fraud division, to compare it to other cases.
Finding a comparable case is hard, said Scanlon, who referred to a crime he prosecuted this year involving an ex-pro football player.
The frauds were similar, he said, but the losses weren't. The ex-pro submitted fraudulent medical claims totaling $2.9 million. The Easterday fraud was "massive," Scanlon said. "Your honor, this is a serious, serious crime."
Bastian said he was puzzled. Easterday took over a family farm of 1,000 acres in southeast Washington and built it into 22,000 acres of potatoes, onions, corn and wheat. After building an empire, he destroyed it, the judge said.
Easterday also fed cattle and Tyson was his biggest customer. Easterday reported in November 2020 that his feedlots and grow yards held 296,535 head of cattle belonging to the company.
Tyson was curious about its cattle investment, according to court records. The company flew drones over Easterday's lots and saw far fewer cattle than in Easterday's inventory report.
When confronted, Easterday said he had lost the money from his scheme - "pissed it away on the merc," according to a Tyson executive, a reference to the Chicago Mercantile Exchange.
"I'm truly sorry to Tyson," Easterday said during the sentencing hearing.
Easterday still faces charges by the Commodity Futures Trading Commission that he submitted false cattle inventory reports to increase the amount he could bet on commodity futures.
The case, also pending in U.S. District Court for Eastern Washington before Judge Bastian, has been on hold until the fraud case was settled.
U.S. attorneys portrayed Easterday as a sire of "extreme privilege," a well-heeled white-collar criminal who shouldn't get less time than a street-level crack cocaine dealer.
Oreskovich disputed the characterization. He said Easterday was a farmer who bought animals at the fair raised by 4-H kids and paid for immigration lawyers to help employees.
"He didn't enjoy extreme privilege. He built an empire," Oreskovich said.
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