OMAHA (DTN) -- The president of a failed organic soybean export company has been indicted by a federal grand jury in Iowa for bankruptcy fraud, accused of defrauding Iowa farmers of more than $4 million for their soybeans.
David Wilcox was the president of Global Processing Inc., a buyer and exporter of non-GMO and organic soybeans. The company based in Kanawha, Iowa, filed for Chapter 11 bankruptcy in October 2022 after losing its grain licenses in Iowa and Nebraska.
Global Processing Inc. focused on marketing identity-preserved food-grade soybeans and exporting the products to Asia.
The indictment filed Wednesday in the U.S. District Court for Northern Iowa alleges Wilcox and Global Processing Inc. (GPI) did not keep accurate records of grain purchases and did not pay farmers. Instead, the indictment alleges "GPI was an undercapitalized sham corporation" operated by Wilcox.
GPI and Wilcox caused the State of Iowa Grain Depositors and Sellers Indemnity Fund to pay out roughly $2 million in losses to producers who filed more than $4 million in claims, and nearly depleted the state fund in the process.
The indictment alleges from 2019 to 2022, Wilcox and GPI signed farmers to contracts to produce organic and non-GMO soybeans at a premium price level. After receiving the soybeans, Wilcox would direct employees to pay some farmers but withhold payment from others. Wilcox would hold checks that had been made out to farmers as well but would place photocopies of those checks in GPI files to make it appear to state inspectors that GPI paid the farmers in a timely manner, the indictment alleges.
Wilcox is accused of obscuring GPI's actual financial situation and his income by directing employees to report Wilcox's personal expenses as corporate expenses.
Rather than pay farmers what they were owed, Wilcox would use the funds from the sale of soybeans for personal expenses, such as buying red angus cattle, cattle genetics or other livestock items, and paying for his credit card expenses and the expenses of "his paramour," the indictment states.
Wilcox directed the creation of false trucking invoices to hide income and kickbacks to individuals as well.
In federal bankruptcy court in November 2022, Wilcox and GPI knowingly made false declarations on the summaries of assets and liabilities for GPI. Wilcox claimed he loaned GPI $275,000, but prosecutors allege he had obtained a bank loan for that amount and funneled the money to himself through a shell company called Verified Grains.
Wilcox had pleaded guilty in U.S. District Court in Minnesota in 2016 to making false statements on a Small Business Administration (SBA) loan application over litigation involving Global Processing and Verified Grains. The original indictment included charges of bank fraud and making false statements, but those charges were dismissed. Wilcox was sentenced in 2018 to three years' probation and $1.347 million in restitution to SBA and a Minnesota bank.
Wilcox is being represented by a federal public defender, who did not respond to an email from DTN seeking comment.
Also see, "Non-GMO Soybean Company Global Processing Lost Grain Licenses in Iowa, Nebraska," https://www.dtnpf.com/…
Chris Clayton can be reached at Chris.Clayton@dtn.com
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