Scam costs ConAgra nearly $650k in fertilizer

Fargo, N.D.-An ex-farm input sales manager faces a maximum of 10 years in prison and a $250,000 fine for an elaborate scheme, carried out over 10 years, in which he stole $642,818 in fertilizer while working at the former ConAgra facility in Moorhead, Minn., and sold it to two other places in North Dakota and Minnesota, according to federal prosecutors. The 70-year-old West Fargo resident, identified as Larry James Schrader, changed his plea to guilty Dec. 4 in federal court here to one of six felony counts; if convicted on all six felony counts, he could have faced up to 60 years, with fines of $1.5 million. Sentencing will be in early February. Assistant U.S. Attorney Jennifer Puhl told Green Markets that Schrader, described as a likeable family man, used his authority with ConAgra to have the fertilizer delivered by trucking companies to Ada Feed & Seed of Ada, Minn., and Larson Grain Co., located in LaMoure, N.D., and used phony documents to show it came from NC Marketing. Schrader would instruct ConAgra employees not to log the fertilizer he had them drain from ConAgra’s tanks on many occasions from 1996 until June 2005. On occasion, Puhl reported, he would have the “missing” fertilizer replaced by water, but it was not known whether any other customers got watered-down product. Puhl said the two dealers receiving the fertilizer were not charged because “there was not enough evidence to indicate otherwise.” Eventually, she reported, the employees got wise to the scam and reported Schrader to ConAgra security. She said the feds got involved because it was interstate transportation of stolen goods, and that the penalties would have been less severe had state lines not been crossed. ConAgra Foods Inc. spokeswoman Stephanie Childs said company security confronted Schrader in 2005, and he was fired. Earlier this year, ConAgra sold the Moorhead location as part of its trade group to Gavilon, owned by a group of investors led by Ospraie Management. Sources reiterated that this was an issue that occurred under ConAgra, not Gavilon.