Informant (72 page)

Whitacre smiled. “None of it’s gonna be lost, Marty! We’re going to make a fortune!’’

“I don’t know . . ’’

“Listen, I’ll guarantee your money. You won’t lose anything. I’ll take all the risk.’’

Allison thought about it for a moment.

“All right, Mark,’’ he said.

“So you invested in the Nigerian deal?’’ Bassett said.

“No, not at all,’’ Allison protested. “I viewed this as nothing more than a loan to Whitacre.’’

“You didn’t see this as giving you a better chance for financial gain?’’

“No. He was already promising me a portion for my help with the faxes. I didn’t think this changed things much.’’

“So what happened with the money?’’

“I wired it from my bank to a New York account. Whitacre gave me all the wiring instructions.’’

“Okay. What did Whitacre say about that?’’

“He was all excited,’’ Allison said. “He kept saying, ‘We’ll be rich.’ ”

Allison glanced at the faces around the room.

“That ended in a couple of days,’’ he said.

Whitacre appeared at Allison’s desk, obviously harboring some inner alarm.

“Something’s wrong,’’ he said. “The money hasn’t shown up in the account.’’

“Have you talked to the Nigerians?’’ Allison asked.

“I can’t find them.’’

Neither man made a sound or a movement.

“I think the money’s been lost,’’ Whitacre said, sounding shaken.

In the months that followed, Allison rarely raised the issue of Whitacre’s guarantee of his $20,000. But in December 1991, Allison was preparing to buy a new house. He needed money to close the deal. He went to see Whitacre.

“So, Mark,’’ Allison said, after explaining the situation, “I really need my money. I’m sure it’s tough, but I need it back.’’

Whitacre nodded, deep in thought.

“We’ll figure something out,’’ he said casually.

Allison left Whitacre’s office, concerned. The tone of his comment bothered him. It was obvious he didn’t have the money; how would they figure something out?

A few days later, Whitacre told Allison that he had come up with a solution.

“Listen, here’s what I’m going to do,’’ Whitacre said, sounding electrified. “I’m going to put together an invoice for twenty thousand dollars and submit it to ADM. They’ll pay it, and that’ll get your money back. Maybe even Lee Covert would help here. We could disburse the money through him.’’

Allison stared at his boss. This proposal sounded very familiar. It was the fraud that the Nigerians had claimed in their letter to have perpetrated against their government. Only now, Whitacre was suggesting that he, Allison, and Covert do it for real, against ADM.

“I don’t know, Mark,’’ he said. “I thought the money would come from you.’’

Whitacre held up his hands.

“Hey, Marty,’’ Whitacre said. “Listen, you’re not going to be alone here. I’ve lost more than two hundred thousand dollars to the Nigerians, and I need to recover some losses, too.’’

Still, Allison felt uncomfortable. What if somebody found out?

Whitacre smiled.

“Marty, I’m the division president,’’ he chuckled. “Nobody will question me.’’

“What happened after that meeting?’’ Bassett asked.

“I agreed to contact Lee Covert to get this going,’’ Allison said. “I told him we needed to do it to recover the losses from the Nigerian transaction.’’

Covert agreed to help. Under the plan, Whitacre would submit a bogus invoice for slightly more than $80,000. Whitacre and Allison would each receive $20,000; Covert would keep the rest and pay all the taxes. Covert formed a company, Covert & Associates, which submitted the bogus invoice. On January 9, 1992, following Whitacre’s written instruction, ADM sent Covert & Associates $81,250.

“What happened to the money?’’ Bassett asked.

“In January or February of that year, I met several times with Covert,’’ Allison said. “Over the course of those meetings, he delivered forty thousand dollars in cash to me.’’

“Why to you?’’

“I was living in St. Louis by then. I was nearby.’’

“What did you do with the money?’’

“I kept twenty thousand, and delivered the rest to Mark.’’

“Delivered how?’’

Allison swallowed. “Cash in a briefcase,’’ he said.

The agents showed Allison a series of documents from the Covert & Associates transaction. He pointed out his own handwriting, as well as Whitacre’s.

“All right,’’ Bassett said. “What led up to your next financial transaction with Whitacre?’’

In the summer of 1993, Allison replied, he was transferred to London.

“Now, I was hearing rumors around the office about executives receiving off-the-books bonuses,’’ he said.

“Rumors from who?’’

“I don’t remember. People besides Whitacre. But I always assumed the rumors were true, and that ADM was making the payments to keep leverage on executives because of the price-fixing at the company.’’

Bassett wrote that down. He was not surprised; by that time, Whitacre had already told Hulse and Richter about such bonuses, and sent illegal payments to both men.

“Anyway, before I left for London, Whitacre came to see me.’’

Whitacre was smiling as he headed into Allison’s office and shut the door.

“Hey, bud,’’ he said. “I’ve got some news for you.’’

Standing in front of his desk, Whitacre explained that Allison was about to receive an off-the-books payment. Allison felt flattered; he assumed it was increasing his status in ADM’s management.

“Now, I’ll tell you what you need to do,’’ Whitacre said, handing him a slip of paper. “Call this 800 number. They’ll help you set up a corporation in Delaware. I want you to call it Nordkron Chemie.’’

Whitacre wrote out the name. Allison looked at it.

“Why Nordkron Chemie?’’

“It’s close to the name of a real company in Hamburg.’’

Smiling, Whitacre explained that the money paid through Nordkron Chemie would include a bonus for him as well. Allison didn’t mind sharing with his boss. He was a team player.

As instructed, Allison set up the corporation and opened an account at Dresdner Bank during a routine visit to Germany. He heard nothing more about the transaction until August, when Whitacre called him in London.

“Well, Marty,’’ Whitacre said, “a $220,000 bonus is almost on its way to Nordkron Chemie.”

Allison was excited to hear the news.

“Now, you understand, most of that is mine,’’ Whitacre said.

“Yeah, I remember.’’

“Okay, here’s how it breaks down. When the money arrives, $140,000 of it is mine. I’ll tell you how to get it to me. And the other eighty thousand is yours.’’

“Okay,’’ Allison said. The money sounded great.

“Now, this is all going to be tied to some bogus research trials in Europe,’’ Whitacre said. “But don’t worry about that. I’ll take care of it.’’

Whitacre instructed Allison to mail him an empty envelope from Germany the next time he was there. Then, he could attach the postmarked envelope to the bogus contract before submitting it for payment.

Allison didn’t understand. If this was approved by management, why the subterfuge?

“It’s just for the accounting people,’’ Whitacre said. “Even though senior management knows about these payments, the accounting department doesn’t.’’

Allison relaxed. That sounded reasonable.

The money arrived in three installments; as promised, it totaled $220,000. Whitacre first requested his share in April 1994, asking for a sixty-thousand-dollar check in the name of Union Bank of Switzerland. Allison did not know that this check was part of the money Whitacre was using to establish the ABP Trading account at Union Bank—the account where a $2.5 million ADM check would be deposited in a few months.

In June of that year, Whitacre asked Allison for three more checks totaling $140,000—in the names of Stiner, DMJ, and Sloan Implement. Despite all the money flowing out, the remaining $80,000 suited Allison fine. But he had some concerns. He called Whitacre, asking how to handle the taxes on these bonuses.

“Well,’’ Whitacre said, “some people claim the payments, some people don’t.’’

“What do you think, Mark?’’

“Hey, Marty,’’ Whitacre said amiably. “Whether you pay taxes is up to you.’’

By the end of Allison’s interview, the full truth seemed to have finally emerged.

The key to the case was Nigeria. In his interview, Sid Hulse—the beneficiary of the first bogus invoice—seemed to have thought that the Nigerian investment had popped up as an idea
after
he received his illegal money. But Allison made it clear that Whitacre had been scrounging up cash for Nigeria many months before. Whitacre had started the old-fashioned way, by borrowing money. But when that ran out, he appeared to have applied the Nigerian’s invoice fraud to ADM, all in the search of the money he needed for his big payoff. Once everything fell through, Whitacre knew that no one at ADM had noticed the outflow of cash. He returned to the corporate till, grabbing cash to compensate himself and his friends for their foolish losses.

The 1991 transactions told the whole story. Of the $530,000 in illegal transfers that year to Hulse and Richter, almost 85 percent ended up in Lagos—not counting the twenty-thousand-dollar loan from Allison and whatever Whitacre invested. The agents and prosecutors were certain that the Nigerian fraud had been the driving force behind this entire enterprise.

The approved bonus plan no longer made any sense. Records from ADM and its accountants proved to be a dry hole; even the corporation’s Caymans subsidiaries were nothing important. Plus, it was hard to believe that each payment coincided so closely with the financial demands of the Nigerians—and later of Whitacre’s friends who wanted their money back.

Making Whitacre’s story less credible, none of the initial money ever went directly to him. Instead, for his fraud allegations to be true, ADM would have to be wiring illegal bonuses to its executives through third parties—including people who didn’t work for the company. Why would sophisticated executives create so many unnecessary witnesses to their crimes? Why not simply wire money directly to Whitacre’s offshore accounts, as was done later in the scheme?

To the agents and prosecutors, there was only one explanation: The use of other executives helped to hide that most of the money was going to Whitacre. In the earliest days of the scheme, he had used his friends and associates to create a wall between himself and ADM. But it was telling that, once money started going to Whitacre personally, his compatriots—who had been paid so much under-the-table cash in their earliest days at the company—never received another dime.

That day, the agents and prosecutors emerged from the Allison interview confident that they had finally figured out the whole truth behind the fraud schemes at ADM.

They had no idea that at least one more piece of the puzzle was still missing.

D’Angelo found it the next week, in the pages of a lawsuit.

ADM had sued Mark Whitacre the previous Thursday, just as it was wrapping up negotiations for the outlines of its plea agreement. The forty-page complaint accused Whitacre of defrauding ADM with a group of associates—including Allison, Ferrari, Hulse, and Richter. But it also named Whitacre’s family members who turned up in the banking records—his wife, his mother, and his in-laws.

D’Angelo looked at the long list of defendants on the first page. All the names were familiar. Except one.

David Page.

Just as the agents had expected, ADM had been holding back. D’Angelo flipped through the suit, and found the name on page 19. The suit said that Whitacre had hired David Page in 1993 but that throughout his employment, Page had continued working for another company, Vanetta USA.

“Page was something of an illusory employee at ADM,’’ the suit said. “Most employees in the Bioproducts Division did not know that David Page was an ADM employee. Page did not hold himself out to others as an ADM employee, and Page did not conduct business on behalf of ADM.’’

What the hell?

Lower down, another sentence jumped out.

“Page also received at least $30,000 from Whitacre’s personal bank account at the Swiss Bank Corporation.’’

D’Angelo reached for the phone to call Bassett. They needed to track down David Page, and find out what Whitacre had been doing with him.

Page turned up in Pennsylvania, and a local FBI office sent an agent to interview him. But when the 302 of the interview came back to Chicago, D’Angelo was convinced the man was lying. The interviewing agent had not known enough about the case to catch the discrepancies. D’Angelo started making plans to visit Page in person.

Page hired a lawyer and agreed to meet the FBI again. By then, Bassett’s transfer to Albany had come through; for the most part, he was off the case. D’Angelo and the case supervisor, Rob Grant, flew to Washington to meet with Page at the Fraud Section.

Page told of being interviewed by Whitacre for a job that paid $120,000 a year, with a thirty-thousand-dollar signing bonus. The interview took place at a Decatur Mexican restaurant in 1993, just as Harvest King was picking up steam.

“I asked Whitacre what my responsibilities would be at ADM,’’ Page said. “And he responded, ‘Nothing.’ ”

It was a scam, Page said. Whitacre told him to kick back one-third of his salary each year; Page could keep one-third and use the other third to pay taxes. Whitacre even received one-third of the thirty-thousand-dollar signing bonus.

“Whitacre assured me that no one would ever know about our relationship or the kickbacks,’’ Page said. “He told me that he was president of the division and no one was looking over his shoulder.’’

Eventually, Page said, he took on a new role. Whitacre was having trouble bringing his overseas cash back into the United States and wanted an untraceable method for obtaining the money—after all, those millions were doing him no good sitting in Switzerland or the Caymans.