Jun14

Eastern Livestock – State Sentences Handed Out

on June 14th, 2012 at 1:07 pm
Posted In: Cattle, Cattle Theft, Cattle, Cow-Calf, Industry News, Cattle, Stocker Cattle

Three former executives of now-defunct Eastern Livestock LLC, formerly of New Albany, Ind., were sentenced Tuesday in connection with a massive check kiting scheme that bilked some 700 cattlemen across the country out of $130 million.

Eastern’s former CFO, Steve McDonald, 58, was sentenced by Metcalfe Circuit Judge Phil Patton to 10 years in prison, with the sentence to run concurrently with any federal prison sentence he might receive.

McDonald had pleaded guilty earlier to criminal syndication-engaging in organized crime, 17 counts of theft by deception of more than $10,000, 144 counts of theft by deception of more than $500 but less than $10,000 and 11 counts of theft by deception of less than $500.

Company accountant Darren Brangers, of Louisville, and company affiliate Grant Gibson, of Lanesville, Ind., each received pretrial diversion for five years on the felony charge of facilitation to engage in a criminal syndicate-organized crime and received two years of probation for pleading guilty to 17 counts of facilitation to commit theft of more than $10,000, 144 counts of facilitation to commit theft of more than $500 but less than $10,000 and 11 counts of facilitation to commit theft of less than $500. The facilitation charges are all misdemeanors.

Gibson is to fund $680,000 of restitution, and Brangers was ordered to fund $210,000.

Former Eastern Livestock founder Thomas “Tommy” Gibson, 71, is scheduled to be sentenced in Metcalfe Circuit Court on June 26, according to the release.

Federal case still pending

McDonald and Tommy Gibson, the father of Grant Gibson, each still face charges in U.S. District Court for the Western District of Kentucky for their involvement in the case.

According to court documents in the federal case, Tommy Gibson and McDonald defrauded both banks, engaging in a scheme between 2004 and 2010 in which billions of dollars worth of checks issued from various bank accounts were deposited in amounts that exceeded the available balances in those accounts, in order to artificially inflate Eastern Livestock’s cash collateral account.

The amounts of money deposited in the cash collateral account affected the amount of funds the banks would release from the company’s line of credit, according to court documents.

They were indicted on one count of mail fraud in connection with the case in September 2011.

The next event scheduled in the case is a conference between the judge and the attorneys involved, which is set for July 11.

Brangers and Grant Gibson are not part of the federal case.

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