Farmers seek millions in damages, state investigating
Thu, 26 Feb 2009 05:55:18 GMT —
Hundreds of Audrain County farmers could be out millions after a Martinsburg grain dealer faces a state criminal investigation.
The attorney general's investigating whether Cathy Gieseker, the owner of T.J. Gieseker Farms and Trucking, violated consumer protection laws.
"We are going after the books, we have frozen the bank accounts," said Attorney General Chris Koster. "And we have opened now an official investigation to find out exactly what has happened."
The company essentially acts as a middle man: buying grain from farmers, storing it, selling it for a profit. But now the state's looking into whether they ever actually paid those farmers back for their grain.
A routine audit by the Department of Agriculture found "discrepancies in Giesecker's financial records" and concerns over millions owed to area farmers now missing. All of Gieseker's financial records have been seized.
"A grain dealership is like a bank," Koster said metaphorically. "And we are concerned that the bank may have gone default."
The state Agriculture Department is now getting involved, and the county prosecutor has launched his own criminal investigation.
The backdrop for all of this is Martinsburg, a small farming town south of Mexico with a population of 326 - but the effects could be far reaching.
"It impacts a wife variety of area," said Mo. Agriculture Director John Hagler. "Maybe even multiple states before it's over."
On Wednesday, practically the entire town - more than 300 people - showed up at a town hall meeting to discuss the failed business. They packed the Knights of Columbus Hall, with mixed emotions, to hear more about how the state might be able to help recover some of their losses.
"Now I know everybody's big question in the room is, 'how bad is it?', said Chris Klenklen, with the Mo. Department of Agriculture. Officials with the Department of Agriculture say based on 100 phone interviews, the final claims could reach into the millions.
"We've talked to farmers...100 farmers, 100 claimants and we got a round figure of about $15 million," Klenklen said to a few quiet gasps. "We know there's a lot of folks here we haven't had a chance to talk to."
The farmers in attendance could have been just a fraction of those who lost money. While some blamed the company, others felt blame should be placed elsewhere.
"I think people need to uncover their eyes," one resident said. "Cathy [Gieseker]'s not in this alone. It's so much money involved in this."
In this community, where everybody knows each other, many deals are often done with a handshake - making it tough for investigators to pin down just exactly who's owed what.
The Department of Agriculture strongly encourages anyone who feels they've been ripped off to contact them at (573) 751-4112 to file a claim.
The deadline to submit a claim is March 31.