No criminal charges will be filed against at least one of the officials with a grain company that went bankrupt nearly 2½ years ago, costing farmers millions of dollars in grain sales, the attorney for one of the businessmen said.
Jeff Rosenzweig, a Little Rock attorney for Jason Coleman, an officer of Turner Grain Merchandising Inc., said Thursday that a representative of the U.S. attorney's office told him late last year that no charges would be brought. "I understand they were not pursuing anything against my client," Rosenzweig said.
Chris Givens, a spokesman for the U.S. attorney's office in Little Rock, said he couldn't comment. "We can't confirm or deny there is an investigation, and it is not our practice to announce noncharges," Givens said.
Rosenzweig said the information came in an "oral communication" but, after a search through his computer, he couldn't find anything detailing an exact date. "Whether it was the week before Thanksgiving or the week after Christmas, I can't say," he said.
Whether the same applies to Turner's other founder, Dale Bartlett, 49, of Marvell, couldn't be determined. It's not clear whether he has a criminal defense lawyer, and a telephone number for Bartlett couldn't be found.
Based in Brinkley, Turner Grain Inc. was shut down in August 2014 after federal grain inspectors found no grain in bins that had been certified as being full.
Turner Merchandising Inc., the parent company, filed for bankruptcy about a month later, listing assets of $13.8 million and debts of $24.8 million. Farmers have filed claims seeking more than $40 million. Turner reported gross sales of $235 million in 2014, according to its bankruptcy filing.
Lawsuits against Turner and its affiliates continue to wind through federal and state courts, as does Bartlett's personal bankruptcy case. Bartlett listed $5.5 million in debts and $2 million in assets. Much of his personal estate -- including real estate, vehicles, guns and coins -- has been auctioned, with proceeds going into his Chapter 7 bankruptcy account, later to be distributed among creditors.
Coleman, 42, hasn't filed for bankruptcy.
The company's collapse left dozens of farmers, grain dealers, truckers and other entities being owed millions of dollars, mainly for grain stored and then sold by Turner.
"I think it was a proper decision," Rosenzweig said. "Just because an investment goes bad and economics change does not mean that a crime was committed, and I am speaking only of my client. That has been our position all along, that no crime was committed."
Jim Mead of Delta Grain Marketing in Jonesboro said Thursday he ran into U.S. Attorney Chris Thyer in early February and asked about the case. Mead said Thyer had Assistant U.S. Attorney Stephanie Mazzanti call him back last week, Mead said.
"She said they couldn't see where they [Turner officials] were doing anything wrong," Mead said. "That's just flabbergasting. They never even took a forensic audit. It's a bad deal."
Givens, Thyer's spokesman, said he couldn't speak to any private conversations Thyer had.
Mead, a Turner creditor who has been a vocal advocate for farmers through the media for more than a year, said farmers were due an explanation.
FBI agents visited him in January 2016, Mead said. "They were gung-ho and left me with the impression that they had the evidence and could find the money," he said. "Now an investigation is shut down and a bunch of farmers are devastated and trying to readjust their lives."
Mead noted a case in Missouri in which a woman was charged with bilking about 175 farmers out of more than $27 million in grain sales. Cathy Gieseker, then 45, was sentenced in 2010 in federal court to nine years in prison after pleading guilty to one count of mail fraud in a case prosecutors described as a pyramid scheme. According to the indictment, Gieseker stored grain for farmers while promising to pay them a higher return later. Instead, Gieseker paid her early customers with cash collected for the crops of later customers, who then went unpaid.
The husband-wife owners of a grain company in northwest Missouri pleaded guilty in 2011 to mail fraud charges. They sold some $3 million in farmers' grain but never paid the farmers, according to federal indictments. Daniel Froman, 66, of Gallatin was sentenced to six years in federal prison without parole. Pauline Froman was sentenced to 18 months in federal prison without parole.
"That was way out in the state, not right there in the capitol of Missouri, like we have here with all the politics in Little Rock," Mead said.
David Wilkison, a Brinkley farmer, said Friday he still has a $400,000 check from Turner that was returned for insufficient funds. He said hearing the Coleman news was disappointing.
He said he and his brother, Keith, another Turner creditor, met with an FBI agent last February. "The agent felt confident there was a strong case," Wilkison said.
"I still want 'em in jail," he said. "I understand we're probably not going to get any money, or much of it [through Turner's bankruptcy], but we do want someone to answer for this."
State authorities have left the Turner case to federal investigators. Bill Sadler, a spokesman for the Arkansas State Police, said Friday that agency has nothing open on Turner Grain.
In an affidavit last year, a former Turner employee said Coleman and Bartlett were "robbing Peter to pay Paul" and that funds among Turner Merchandising and its several affiliates were commingled to pay each other's debts and sometimes to buy personal property for Coleman and Bartlett.
Meanwhile, the trustee for the Turner estate in bankruptcy court has filed more than 40 lawsuits seeking the return of some $110 million paid to Turner creditors or Turner's own related companies just prior to its bankruptcy filing.
About $90 million of that is sought from Turner-related companies -- Turner Commodities Inc., Ivory Rice, Agribusiness Properties, and Brinkley Truck Brokerage, all based in the same small office building on Main Street in Brinkley. Federal bankruptcy law allows the trustee to seek the return of such payments made within a year of a bankruptcy filing. The Turner trustee hasn't indicated whether Turner Merchandising or any of its related companies have any assets.
Similar lawsuits have been filed against farmers who received payments within 90 days of the bankruptcy filing, also allowed by law so that all creditors are treated equally.
Another lawsuit by Turner's bankruptcy trustee claims Gavilon Inc., a Nebraska grain broker, is responsible for at least $14 million in Turner losses.
Two lawsuits are pending in state court. In Lonoke County, a lawsuit filed by a group of farmers is set for trial in May. Three of the farmers involved in that lawsuit declined to comment Friday on the Coleman development. Another lawsuit is in Poinsett County against Turner and KBX Inc., a Benton grain dealer.
Rosenzweig said he contacted the U.S. attorney's office and the FBI not long after he was retained by Coleman. "Because it was a high-profile case and we knew agents were out there, we made contact with the U.S. attorney's office, to make them aware of our existence," he said. "We had occasional conversations."
While the FBI and the U.S. attorney's office declined all last year to comment on any investigation, or to confirm or deny the existence of one, court filings by Turner Merchandising's bankruptcy trustee refer to occasional meetings or telephone conversations involving the FBI, Coleman and his attorneys.
One note from the trustee refers to an FBI agent "calling me once a week for a report on Jason's cooperation." Another note refers to a telephone call involving possible limited immunity from prosecution for Coleman "to assist Trustee to recover assets for the estate." Those references are in filings by the trustee seeking payment for work and reimbursement of expenses.
Turner's collapse came at a time when the state had few regulations over such a company.
Turner was considered in the industry to be a "principal" or "jobber" rather than a broker. A jobber contracts to buy and take possession of grain and delivers it to the ultimate buyer.
Lawmakers responded with laws requiring grain buyers to prove they have the financial capacity to carry out their transactions. Legislation also tightened record-keeping requirements and established a "slow-pay hotline" for farmers who run into such problems with grain dealers and brokers.
Business on 03/11/2017