Texas Cattle Fraud Scheme Leads to $100 Million Restitution, Co-Founders Forced to Pay Over $2 Million in Gains

Key Takeaways

• $100 Million Restitution: Agridime LLC has been ordered to pay over $102 million in restitution to defrauded customers, as part of a consent order following a fraud case.
• Permanent Ban: The court permanently bans Agridime from engaging in CFTC-regulated markets and from violating the Commodity Exchange Act (CEA) and CFTC regulations.
• Co-Founders Disgorge $2.3 Million: Co-founders Joshua Link and Jed Wood are required to pay a combined $2.3 million in disgorged gains from the fraudulent scheme, with funds directed to defrauded customers.
• Fraudulent Scheme: Agridime misused customer funds intended for cattle purchases, paying older customers with new funds—a Ponzi scheme tactic—and using funds for undisclosed commissions.

Deep Dive

In a high-stakes legal battle, a Texas firm once thriving in the cattle industry now finds itself on the hook for defrauding its customers. Agridime LLC, which is currently in receivership, has been ordered by the U.S. District Court for the Northern District of Texas to pay nearly $103 million in restitution to customers who were duped by its fraudulent activities. This ruling follows a lawsuit filed by the Commodity Futures Trading Commission (CFTC) over what amounted to a Ponzi scheme disguised as a legitimate cattle investment venture.

Agridime’s conduct was anything but what it promised its customers. The company had led investors to believe their money would go toward purchasing, raising, and feeding cattle. Instead, those funds were used to pay off earlier investors, all the while failing to purchase the promised number of cattle. Worse yet, millions of dollars were pocketed by the firm’s top brass, including co-founders Joshua Link and Jed Wood, in the form of undisclosed commissions.

Under the final judgment, Agridime is permanently banned from operating in any CFTC-regulated markets, and its management is prohibited from engaging in further violations of the Commodity Exchange Act (CEA) and CFTC regulations. The restitution payments will be distributed by the receiver appointed in a parallel SEC action, offering a small glimmer of hope for customers who were left holding the bag.

Meanwhile, the court didn’t stop with Agridime. The co-founders, Link and Wood, were hit with a default judgment requiring them to disgorge a combined $2.3 million in ill-gotten gains. Link will be required to pay $815,327.92, while Wood is on the hook for $1,472,127.92. These funds will also be directed to the defrauded customers, although the CFTC has warned that there’s no guarantee of full recovery, as the wrongdoers may not have enough assets to meet the restitution demand.

Despite the challenges ahead, the CFTC made it clear that its pursuit of justice is far from over. "We will continue to take action to hold wrongdoers accountable and protect consumers," said the agency. This case is yet another stark reminder that, in the world of commodities trading, deceit and fraud are met with serious consequences.

A Look at the Scheme

The case against Agridime, Link, and Wood stems from a CFTC complaint filed in May 2024. The complaint accused the defendants of using deceptive tactics to solicit customer funds for the purchase of cattle, only to divert those funds for personal gain. Rather than fulfilling their obligations to investors, Agridime used new customer money to pay returns to earlier customers, a move eerily similar to a Ponzi scheme.

While customers thought their investments were going into cattle farming, the reality was far more insidious. Agridime had no intention of meeting its obligations and instead used their funds to cover up its fraud, while the co-founders enjoyed undisclosed commissions. The court’s decision to impose such heavy financial penalties is a potent reminder that financial crimes in this sector come with severe consequences.

The court’s ruling also sets a powerful precedent, showing that both the firm and its executives will be held fully accountable for their actions. While customers may still be facing uncertainty in terms of total recovery, the CFTC’s vigilance in pursuing justice and transparency offers a degree of assurance that fraudsters cannot hide forever.

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