Wednesday, December 29, 2010
2010 Eastern Livestock: The aftermath of bad checks continues to hit cattle market
by Kristy Foster Seachrist
Eastern Livestock: The aftermath of bad checks continues to hit cattle market
SALEM, Ohio — More than $130 million has been lost by 743 cattle producers and sellers after Eastern Livestock Company came up short in their bank account in November.
Checks begin bouncing in early November after cattle were sold at sales and directly to Eastern Livestock. Eastern Livestock Company has been forced into bankruptcy court and several lawsuits have been filed across the country in the matter, and the U.S. Justice Department is also investigating.
Scheme discovered. According to court documents filed in Hamilton County Court of Common Pleas, Fifth Third Bank alleges a complicated bank fraud and check-kiting scheme.
When Fifth Third discovered Eastern Livestock’s scheme, the bank froze the account.
Since Eastern Livestock has been prevented from cycling checks in and out of its main Fifth Third checking account, the account has been determined to be overdrawn in the amount of at least $13 million and possibly even more as items continue to be returned for insufficient funds.
Fifth Third Bank is asking for a judgment in excess of $32.5 million plus $13 million for the alleged theft.
