Farm Ponzi Scheme Nets South Dakota Man

Such fraud doesn’t exist only on Wall $treet, you know.

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South Dakota Man Pleads Guilty To Federal Charges In Feedlot Scheme
8:00 pm, Aug. 10, 2021
https://www.agweek.com/news/crime-and-courts/7148308-South-Dakota-man-pleads-guilty-to-federal-charges-in-feedlot-scheme

SIOUX FALLS — A Corsica, South Dakota, man has pleaded guilty to federal wire fraud and money laundering charges related to his operation of a custom cattle-feeding business that involved millions of dollars.

Robert Blom, 59, pleaded guilty to one count of wire fraud and one count of money laundering last month as part of a plea agreement that was accepted by the U.S. District Court on Aug. 2.

Robert Blom, 59, a cattle farmer in Corsica, South Dakota, will be sentenced for his crimes in November 2021.

With the charges, Blom faces a maximum sentence of 40 years in prison, with a 20-year maximum for each count. Blom is also subject to a fine of up to $750,000, and restitution may also be ordered in the case. He is scheduled to be sentenced in November by U.S. District Judge Karen Schreier.

Blom was facing a combined 32 counts of wire fraud and money laundering when the federal case indictment against him was filed in March 2020. At the time, the indictment detailed about $10 million in funds involved in Blom’s federal case with the fraud and laundering charges.

The money laundering charge that Blom pleaded guilty to centers on a payment of nearly $350,000 Blom made to a victim on Dec. 18, 2018, while the wire fraud charge was centered on an investment check from a victim written out for $256,996.72 that same month.

In the plea agreement, Blom admits that he “falsely and fraudulently represented to investors that he would use their money to purchase groups of cattle and to care for those cattle. Instead, the defendant routinely used money from new investors to pay back old investors, often by check.”

All told, the cattle Ponzi scheme has been estimated to have up to $20 million in losses, with it estimated that about 28,000 head of cattle were not accounted for in Blom’s scheme.

According to court documents, he sold the same groups of cattle to multiple different investors, altering purchasing invoices to conceal that he sold the same group of cattle. A civil foreclosure case in Douglas County, South Dakota, that was opened in 2019 involving the banks and the individuals that were victims of Blom’s currently remains ongoing. More than 70 parties have been listed claiming that Blom owed them money. First Dakota National Bank said Blom had overdrawn his bank account by more than $1 million and owes the bank more than $6 million.

Blom was convicted in 2019 of a felony charge for writing a bad check to a cattle buyer in North Dakota. Blom was sentenced to five years in prison, with all but 180 days suspended, followed by eight years of probation.

Blom also faces a similar charge in South Dakota — theft by insufficient funds check — a Class 3 felony, although the case has not had any new proceedings since February.