FOR IMMEDIATE RELEASE THURSDAY, JULY 6, 2006 WWW.USDOJ.GOV

CRT (202) 514-2007 TDD (202) 514-1888

         

THE UNITED STATES CHARGES WIDESPREAD CONSPIRACIES TO STRUCTURE OVER
$4.5 MILLION IN MONEY TRANSACTIONS AND TO COMMIT TOBACCO FRAUD

Nashville, TN - July 6, 2006 - Nine individuals have been indicted by a federal grand jury in Nashville, charged with structuring over $4.5 million in cash. Three individuals also have been charged with fraud related to a tobacco program administered by the U.S. Department of Agriculture (USDA) announced James K. Vines, U.S. Attorney for the Middle District of Tennessee; My Harrison, Special Agent in Charge, Federal Bureau of Investigation, Memphis Division; Louis Huttenbach, Special Agent in Charge, Department of Agriculture, Office of the Inspector General; Cleve Daniels, Special Agent in Charge, Internal Revenue Service Criminal Investigation Division, Nashville Field Office; and Mark Gwyn, Director of the Tennessee Bureau of Investigations.

Indicted were Robert D. Oldham, of Nashville, TN, Christopher L. Sutton, of Ayden, NC, Joey Bowen, of Winterville, NC, Ronald D. Bowen, of Ayden, NC, Bobby C. Cates, of Lexington, KY, Garth E. Middaugh, of Lafayette, TN, Clarence W. Shirk, of Beavertown, PA, William A. Shotwell, of Somerset, KY, Kenneth A. Swayne, of Lancaster, PA, Rennie Turner, of Winterville, NC, and Sam A. Turner, of Cookeville, TN. The defendants were charged in a three-count indictment unsealed today. The first count of the indictment charges Robert Oldham, Christopher Sutton, Joey Bowen, Ronald Bowen, Bobby Cates, Garth Middaugh, Clarence Shirk, Kenneth Swayne, and Rennie Turner with conspiring to structure transactions involving over $4.5 million with financial institutions in Tennessee, Pennsylvania, North Carolina, and Kentucky, for the purpose of evading federal reporting requirements. The second count of the indictment charges Robert Oldham, William Shotwell and Sam Turner with conspiring to falsify information provided to the USDA. The third count of the indictment charges Robert Oldham with money laundering. The indictment also seeks the forfeiture of over $4.5 million in connection with the structuring conspiracy offense, and $11,000 in connection with the money laundering offense.

At times material to the indictment, the USDA operated a burley tobacco allotment program. This program established quotas to regulate the amount of burley tobacco that could be grown on any particular farm during the yearly tobacco growing season. To ensure compliance with the USDA quotas, each participating farmer was issued a USDA Burley Marketing Card. This card identified the farm on which the burley tobacco was to be grown. The card also stated the maximum number of pounds of tobacco grown on the farm that could be legally marketed or sold within the particular crop year. The term "excess tobacco" referred to when tobacco was sold on a USDA Burley Marketing Card as if it was grown on the farm related to the card utilized but was actually grown elsewhere.

According to the indictment, each defendant was engaged in the tobacco industry. Christopher Sutton and Robert Oldham knowingly directed and caused Ronald Bowen, Bobby Cates, Garth Middaugh, Clarence Shirk, Kenneth Swayne, and Rennie Turner to conduct financial transactions of over $4.5 million in increments under $10,000 for the purpose of avoiding the federal reporting requirements. Christopher Sutton and Robert Oldham, and persons at their direction, allegedly gave these individuals money in the form of checks or wire transfers, with the intention that any cash transactions using this money would be in amounts under $10,000 to avoid the filing of Currency Transaction Reports (CTRs). Domestic financial institutions were required to file CTRs for each transaction in currency in excess of $10,000. The cash obtained through the structured transactions was used, at least in part, for buying and selling tobacco, including excess tobacco.

According to the indictment, Robert Oldham, William Shotwell and Sam Turner agreed to illegally sell excess tobacco on USDA Burley Tobacco Marketing Cards in Hartsville, Tennessee and elsewhere, knowing that the tobacco sold was not grown on the farms designated on the cards utilized in the transactions. The indictment further alleges that Robert Oldham organized transactions involving the purchase and sale of excess tobacco; William Shotwell utilized his
tobacco warehouse to permit the sale of excess tobacco; and Sam Turner utilized USDA Burley Marketing Cards under his control to illegally sell excess tobacco. Robert Oldham is also charged with conducting a financial transaction to launder approximately $11,000 in U.S. Currency represented to be the proceeds of narcotics trafficking.

This investigation was conducted by the FBI, USDA-Office of Inspector General, IRS Criminal Investigation Division, and TBI. Assistant U. S. Attorneys Lori Glenn and Sam Williamson will represent the United States.

Note: An indictment is a form of accusation and is not evidence of guilt. Each defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.