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This Is What Is Happening With The Agridime Cattle Ponzi Scheme
Season 1 Episode 165
We wrap up 2023. We have all the details about Cattle Ponzi Schemes plus we will tell y'all about an opportunity of a lifetime to lay into one of the most efficient sets of cows around. Join Jeff 'Tigger' Erhardt, the Boss Lady Rebecca Wanner aka 'BEC', and our crew as we bring you the latest in markets, news, and Western entertainment on this all-new episode of the Ranch It Up Radio Show. Be sure to subscribe on your favorite podcasting app or on the Ranch It Up Radio Show YouTube Channel.
EPISODE 165 DETAILS
So many of you have reached out inquiring about the latest details about the Agridime Cattle Ponzi Scheme. It gets rather complicated, but BEC and I break it down for you.
Some of the most feed efficient cows around are coming up for sale. Lucky 7 Angus Ranch is selling their spring calving Oklahoma cows at public auction, January 8th at Ogallala Livestock Auction in Ogallala, Nebraska.
AGRIDIME
According to articles in the Bismarck Tribune and Ag Week, the U.S. Securities and Exchange Commission, which filed a civil lawsuit against the company on Dec. 11, has labeled the operation a Ponzi scheme, in which Agridime was using investor money to pay existing investors and commissions to salespeople rather than using new money to do what it said it would — purchase, feed and care for cattle to be finished and sold to consumers as beef. The SEC has received a temporary restraining order, including an asset freeze, on the company owned by Joshua Link of Arizona and Jed Wood of Texas, through Jan. 9, pending a hearing on Jan. 5.
As of Sept. 5, 2023, Agridime-held cattle contracts required payment to investors of $123 million in principal, plus $24 million in guaranteed "profits." The company, as of Sept. 30, 2023, had less than $1.5 million and insufficient operating revenues, the SEC complaint said.
Carl Karpinski, enforcement attorney for the North Dakota Securities Department, said there is no confirmed tally yet on investment losses in North Dakota. But he said the eventual number may be significant.
"North Dakota is one of the most — if not the most — affected states" in the nation, he said.
While the SEC complaint did not go into specifics about the cattle the company did purchase, other than specifying that "Defendants did not buy the number of cattle required to fulfill the Company's obligations under the Cattle Contracts," Agridime was licensed as a livestock agent in North Dakota. Agriculture Commissioner Doug Goehring announced on Dec. 15 that it no longer will be licensed in the state.
“Agridime was licensed in North Dakota,” Goehring said in a statement. “Their renewal was pending based on issues with bonding. The actions taken by the SEC will support our denial of their license and we will issue a cease-and-desist order, effective (Dec. 15), to prevent further purchase of livestock.”
Karpinski said the Securities Department is not working on the cattle sales side of the case, though the North Dakota Department of Agriculture and U.S. Department of Agriculture are involved. Ellingson encouraged producers involved in the case to contact the Stockmen's Association at 701-223-2522.
HOW AGRIDIME OPERATED
The SEC complaint said Agridime raised $191 million from more than 2,100 investors in at least 15 states since January 2021. Instead of using investor money as advertised, the SEC filing said Agridime has used at least $58 million from Dec. 1, 2022, to Sept. 30, 2023, in investor funds from new cattle contracts to make principal and profit payments to previous investors.
Agridime would sell investors cattle contracts for $2,000 per calf. The company would then promise to buy the cattle back a year later at return rates of 15% to 32%, the complaint says.
Agridime paid commissions to salespeople, typically 10%, for each cattle contract sold, which also was not disclosed to investors. The SEC documents say that t
Published on 1 year, 11 months ago