A Washington state cattle rancher will serve 11 years in prison after his ‘Ghost Cattle’ scam racked up over $244 million in fraudulently obtained payments from partner companies.

According to the Department of Justice, 51-year-old rancher Cody Allen Easterday used his company Easterday Ranches Inc to funnel millions of dollars out of Tyson Food Inc. and another company referred to as Company 1 in court documents. Easterday used the money to fund his lifestyle and pay off previous debts he was carrying. Officials detail the scheme began in 2016 and ran for four years before Easterday was caught.

Starting in 2016, Easterday entered into a series of agreements with Tyson Food Inc. and company 1. As part of the agreement, Easterday’s company agreed to purchase and feed cattle on behalf of both companies. In return, both companies advanced payments to Easterday Ranches for the cost of purchasing, feeding, and raising the cattle until it was time for them to be slaughtered and sold. As part of the agreement, Easterday Ranches would pay back the money advanced including interest and other costs. Any difference that remained served as profit for Easterday Ranches. As part of the agreements, Easterday Ranches was able to obtain $244 million in contracted payments.

Despite this agreement, officials detail that Easterday never purchased or fed any of the supposed cattle he said he would. Instead, Easterday used the money for his own personal pleasures and to cover the losses of approximately $200 million in commodity futures contracts. Officials detail that along with the fraudulently obtained funds from Tyson Foods Inc. and company 1, Easterday defrauded the CME Group Inc. CME operates as the world's largest financial derivatives exchange. According to the DOJ, by submitting false and fraudulent paperwork, Easterday’s company was excepted from application limits in live cattle future contracts.

Easterday pleaded guilty and agreed to a plea agreement that will require him to pay $244 million in restitution including an estimated $233 million to Tyson Food Inc. Easterday has already paid back $70 million following his chapter 11 bankruptcy proceedings.

Following the verdict, Easterday and his legal team pushed back with claims of their own. His team argued that Tyson Food Inc. was in violation of the Packers and Stockyards Act of 1921 because they collected over $51 million in interest and guaranteed funds from Easterday Ranches. Easterday also contended that his company and Tyson Food Inc. entered into a marketing venture utilizing “Cody’s Beef.” The venture spanned 11 years, and during this time, Easterday’s company was not compensated the $100 million he says it was owed.

Easterday’s lawyers shared in a memo that the rancher was remorseful for his actions and that he was an upstanding member of his community. The memo explained in part, "Mr. Easterday has substantial community ties and family support. Mr. Easterday's multitude of altruistic actions ranges from giving employees unexpected opportunities for advancement, to housing for employees in need, to assisting migrant workers obtain citizenship, and supporting every community event or need financially and by his own labor. Mr. Easterday is extremely remorseful for his conduct having destroyed Easterday Farms and the associated impact."

Prior to sentencing, Easterday's legal team asked the court for leniency citing that Easterday’s ghost cattle fraud scheme was enacted to pay off his high-risk financial investment losses and was “not sophisticated” or used "to finance a lavish lifestyle."

However, U.S. Attorney Vanessa R. Waldref for the Eastern District of Washington explained, “No one is above the law. Mr. Easterday amassed significant personal wealth, yet, he wanted more, so he defrauded his victims of nearly a quarter billion dollars by charging for cattle that never existed.”