The Informant

by Kurt Eichenwald

  Waxman nodded. “I’ll make some inquiries.’’

  The lawyers left the office at 7:50. Waxman hurried to his desk and wrote down everything the lawyers had said.

  “What are they accusing me of?’’ Shepard asked sharply, shock framing his face. “What are the specifics?’’

  Hoyt shook his head. “I don’t know, Brian,’’ he said. “They won’t tell me.’’

  It was early the next morning, a Friday. Hoyt had asked Killham and Shepard to his office to discuss the previous day’s call with the Justice Department. Hoyt was still simmering about the treatment he Eich_0767903277_5p_02_r1.qxd 10/11/01 3:57 PM Page 367

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  and his agents had received. Now, just as Hoyt had expected, the sniping from Washington was taking its toll on Shepard.

  “Look, if they don’t trust me, take me off the case!’’ Shepard snapped angrily.

  “Brian, I understand how you feel,’’ Hoyt said. “But let’s think about this before we do anything.’’

  Shepard paced. “How can they accuse me?’’ he said. “This makes no sense.’’

  Hoyt was at a loss for words. Since the previous day’s call, he had concluded that this “agent wrongdoing’’ allegation was almost certainly just a defense ploy; the law firm had probably developed a nickel’s worth of information and used it to make fifty dollars’ worth of accusations. He was sure it was designed to drive a wedge between the agents, the prosecutors, and the witness—all for the purpose of derailing the price-fixing case. And it was working. Shepard flopped into a chair, looking spent.

  “How can I not contact Whitacre?’’ he asked. “The guy’s a basket case. How can I not talk to him?’’

  “That’s what they’re telling us to do,’’ Hoyt responded.

  “John, I’ve already got calls from him. He’s left messages. Am I supposed to ignore him?’’

  Hoyt sat back in his chair. This whole situation was absurd. The FBI didn’t just cut off sources. For all they knew, maybe ADM was setting them up so that Whitacre would see the FBI as the enemy and start helping the company.

  “All right, Brian,’’ Hoyt said. “Don’t call him back. But if he calls you, you can listen to him.’’

  That wasn’t good enough. Whitacre had to be told why, Shepard said, in person. It was the right thing to do.

  Finally, Hoyt relented. Shepard could go visit Whitacre to explain that they could no longer talk. Killham was ordered to ride along, to ensure that there was a witness to the conversation. There would be no discussions of the case, no instructions given. That way, Hoyt figured, they could argue later that they had followed the spirit of Waxman’s instructions, even if they had ignored the letter. That same morning, Mary Spearing was getting worried. The grapevine was already buzzing with the word that Lassar might be allowed to pursue the case against Whitacre. The only way that the Fraud Section would win a role in this headline-making case was if somebody pushed. Eich_0767903277_5p_02_r1.qxd 10/11/01 3:57 PM Page 368 368

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  After discussing the situation with Don Mackay, Spearing picked up the phone and called Waxman. She explained that she strongly believed Whitacre should not be prosecuted by anyone involved in the price-fixing case.

  “The big issue here is the appearance of propriety,’’ Spearing said. The key witness in a major antitrust case had been found embezzling from the target. Anything the prosecutors on that case did would be suspect.

  “They’d be open to exposure for being unduly harsh to the informant or being unduly lenient,’’ Spearing said. “Somebody needs to handle this who is truly independent, to maintain public confidence in the results.’’

  At one point, Spearing added a new wrinkle to the logic. Williams

  & Connolly was raising concerns of possible wrongdoing by the agents in Harvest King. They had made it clear that they would not cooperate unless they were assured those agents were cut out of the case. What was needed, she argued, was a “Chinese wall,’’ a sharp restriction in the flow of information to anyone in Harvest King. Whatever emerged from the investigation of Whitacre would be kept secret from them; they would be forbidden from seeing documents or interviewing witnesses. Eventually, Spearing got the decision she wanted. The criminal investigation of Whitacre was assigned to the Fraud Section. On top of that, the Chinese wall was put into place. No information was to be shared with the case agents from Harvest King—or, to Spearing’s delight, with Scott Lassar. No one would be able to meddle with the investigation. They could simply ignore the price-fixing case. Immediately, Spearing began arranging an interview with Whitacre for the following Monday, if he was willing.

  Don Mackay was not as pleased with the results. Even though he said nothing to Spearing, he didn’t think the Fraud Section needed to take the case. Lassar and his crew were professionals. They knew the players better; they were farther up the learning curve. This decision was just going to cause unnecessary delays in the investigation. And maybe that was the whole point.

  The government, Mackay feared, might just be playing into the hands of Williams & Connolly and its client, ADM. Shepard put on his blinker as he drove the final yards toward Whitacre’s driveway. As soon as Hoyt gave the authorization, Shepard Eich_0767903277_5p_02_r1.qxd 10/11/01 3:57 PM Page 369

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  had scheduled an appointment to see his witness. As ordered, Killham had come along with him. Shepard was glad to have the company for this Whitacre meeting. It was sure to be difficult.

  They parked in front of the house, where Shepard spoke with Whitacre briefly. They decided to head across the street to the horse stables.

  Whitacre brought along Ginger; as promised, he had already told her about his confession to the agents. The couple looked desolate and frightened. Shepard introduced Killham to them, and the Whitacres mumbled a greeting.

  “My attorney advised against having this meeting with you two,’’

  Mark said calmly. “But I want to.’’

  Shepard nodded. “Well, Mark, I want to tell you something. The nature of our contacts have to change as a result of your statements about financial transactions.’’

  The agent said he would no longer be able to ask Whitacre about anything involving ADM. If Whitacre called and tried to give either Shepard or Herndon such information, he would be told to stop.

  “And if you don’t stop,’’ he said, “we’ll hang up.’’

  Whitacre nodded.

  “Now,’’ Shepard continued, “you can call all you want to discuss personal matters, your family situation, your feelings. But no more than that.’’

  Whitacre said nothing.

  “Mark, please understand this isn’t what I want,’’ Shepard said. “I don’t have any choice here.’’

  The words passed by Whitacre, seemingly unnoticed.

  “I’ll tell you, Brian, my frustration and anger is all coming from my work with you,’’ he said. “I mean, this stuff with the media is terrible. It’s all just ‘Dump on Mark Whitacre.’ It’s not right. I’m harassed by the media and ADM while Mick and Terry aren’t harassed by anybody. They’re still at the company, and I’m out here alone. And none of you guys are being supportive.’’

  “Mark, remember, whenever you asked what would happen when the case went overt, I always told you it was impossible to predict. The press coverage was impossible to predict. We couldn’t know what they would say.’’

  “Well, what about Mick and Terry?’’

  “Any prosecution of them is going to take time. The case is continuing. But don’t expect immediate action.’’

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  As Ginger listened, she wept. She didn’t like what she was hearing. Her husband had given the FBI everything. And now they were leaving him hanging out to dry.

  “You don’t know wh
at you’re doing to him, you don’t understand what he’s going through,’’ she shouted. “He worked for you for two and a half years, he risked his career for this case, and now you’re turning your back on him.’’

  “Ginger—’’

  “I don’t think anything’s ever going to happen to ADM!’’ she shouted. “They’ve got too much money and too much influence. And they’re just terrible people.’’

  Burying her face in her hands, Ginger was wracked with sobs. Mark sat nearby, watching. Shepard felt torn by what he was seeing and asked Mark to leave the stable for a moment. With barely a shrug, Mark stood and walked away.

  “Ginger,’’ Shepard said in a comforting tone, “we are concerned. The reason we came today was because of our concern for yours and Mark’s well-being.’’

  Ginger’s eyes were icy. “Does everything he did for you people mean nothing?’’ she asked sharply. “He’s just been used by the government, and now you’re throwing him away.’’

  “No, Ginger, his assistance meant a great deal.’’

  “Well, who was really the target of this damned investigation? Was it Mick and Terry, or was it Mark?’’

  Ginger broke down again. “I don’t know what’s going to happen,’’

  she cried. “I don’t know how to plan from day to day. He’s just falling apart.’’

  They couldn’t tell her what to expect, Shepard said. She would have to take it one day at a time and reach out to the agents if she had personal matters to discuss. Ginger nodded, saying she believed that Shepard did care about their situation, even if the government generally did not.

  “I’m so frightened for him,’’ she said. “He’s going to kill himself. And there won’t be any case if he kills himself because the government turned its back on him.’’

  “Help Mark any way you can,’’ Shepard said. “Make the arrangements for the move to Tennessee.’’

  Ginger nodded. “I’ll do what I can,’’ she said.

  Once Ginger seemed better, Killham walked outside and brought Mark back. He sat on the couch.

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  “Mark,’’ Shepard said, “there are probably going to be some very hard times in your future. Remember, focus on the important things: your health and your family. You’re very fortunate to have a loving wife and family. Turn to them.’’

  Whitacre nodded.

  “But if you need to talk about any personal concerns,’’ Shepard continued, “Bob and I are available for you. Remember that.’’

  There was nothing left to say. The agents said good-bye and headed back to the car. As they turned onto the road, Shepard’s eyes misted. The meeting had been one of the most wrenching experiences of his career.

  What the hell were these agents thinking?

  The response from the Fraud Section to Shepard’s final visit with Whitacre was fast and furious. They had been ordered to stay away from him. Spearing was particularly angry, lashing out that no one in Harvest King was to contact Whitacre. An objection was raised that Whitacre was a cooperating witness who couldn’t just be cut off.

  “He’s not a CW!’’ Spearing shot back. “He’s a target!’’

  “I want to know everything you did,’’ Epstein said, looking at Whitacre sternly. “I want to know who you did it with, when you did it, and what evidence you have of it.’’

  Whitacre nodded. Epstein had been told that prosecutors from the Fraud Section wanted to meet Whitacre on Monday, August 7. The idea made Epstein horribly uncomfortable, but Whitacre was determined to attend and explain everything. He felt sure that the government would understand.

  “Now, Mark, if you’re not prepared to tell the truth and tell everything, then we’re far better off not going,’’ Epstein said. “It would be better not to go than to leave out one detail or, God forbid, say something you know is wrong. It will just get you deeper and deeper into this.’’

  “I understand,’’ Whitacre said. “I’m gonna tell the truth.’’

  For hours, Epstein and his partner, Zaideman, debriefed Whitacre. He provided numerous details of his financial activities. One scheme, involving a $2.5 million check made out to a company called ABP, had been hatched with another executive, he said.

  “I didn’t get all of that money,’’ Whitacre said. “One million dollars of it went to Lennart Thorstensson, the president of ABP.’’

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  “Why did he get the money, Mark?’’ Epstein asked.

  “He was the guy behind it. A million was for him.’’

  As they finished the briefing, Epstein was less comfortable than when they had begun. The story had holes.

  “Mark, this just isn’t convincing to me,’’ Epstein said. “I don’t believe it.’’

  “I swear, I swear I’m telling you the truth.’’

  “They’re going to tear you apart on this. I don’t think you should go in, because I don’t believe it.’’

  “I want to go in. I’ve gotta tell them.’’

  Finally, Epstein relented. As a lawyer, his job was to give advice. He couldn’t stop a client who insisted on destroying himself. Bloomington, Illinois, was quickly becoming Whitacre’s site of choice for secret meetings. That weekend, he traveled to a hotel there to meet with David Page, a man he had recruited for a position at ADM two years before.

  Page’s hiring had been one of Whitacre’s secrets; Page still worked for a supplier of ADM, a fact that Whitacre had told him to hide on his application. When he had offered Page the job, Whitacre had promised it would entail no responsibilities. He had lived up to his word. But now, Page was worried. He had read about Whitacre working for the FBI. Had Whitacre told the government about their dealings? He had called Whitacre in a panic, and Whitacre had agreed to meet. Page started by questioning Whitacre about his role as a government mole.

  “David, don’t believe everything you read,’’ Whitacre said. “Most of what you’re reading in the paper is untrue. I wasn’t working as an informant.’’

  Joseph Caiazzo, the lawyer representing the lender for Whitacre’s home purchase, was ready. He had opened a trust account at a Fleet Bank branch in Brooklyn, calling it the I.O.L.A. account. On August 4, the final instructions for wiring the money to Fleet were faxed out. By Monday, $941,000 was to arrive in the I.O.L.A. account, just enough to pay for the house and a few additional expenses. The Whitacres were almost set to close.

  Ginger Whitacre was beside herself. Mark seemed out of control. He brooded around the house, sneaking off at every opportunity to call Eich_0767903277_5p_02_r1.qxd 10/11/01 3:57 PM Page 373

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  some reporter— any reporter, anywhere—and rage about his ill treatment by ADM, by the government, by the press at large. This was their chance to get away from Decatur, to start anew, but Mark just wouldn’t let it go. Now, having heard about his illegal financial dealings, Ginger’s anger had boiled over. With Mark grumbling about some other perceived injustice, Ginger screamed. What about me? What about the family? In a pique, she smacked Mark hard across the head.

  “I can’t take this!’’ she screamed. “You’re not here anymore! You’re not part of this family anymore!’’

  Ginger stared hard at her astonished husband.

  “For all the good you’re doing,’’ she screamed, “you might as well be dead!’’

  The first public report appeared that Monday morning, August 7, in the Decatur Herald & Review: ADM planned to announce that day that Whitacre had been fired for embezzling at least $2.5 million. News organizations around the world picked up the story, reporting that the FBI informant was now accused of his own crimes. At the same time, ADM sent Whitacre a terse letter of termination.

  His six-year career at the agriculture giant was over. Passengers lin
ed up that morning as their seats were called for the early flight to Chicago from Washington’s National Airport. Don Mackay and Jim Nixon were near the front of the line, while Spearing stood farther back. Beside her was Supervisory Special Agent Edward Herbst, who was expected to conduct much of the Whitacre interview. Herbst, who worked in Washington, had been temporarily assigned to the job on Saturday, until full-time case agents could be found. He still knew little about the situation, but Spearing planned to brief him on the way.

  Minutes later, after settling in their neighboring seats, Spearing handed Herbst the notebook of documents from Williams & Connolly. The agent flipped it open.

  The records told the grim story. They showed that Whitacre had personally signed the check distribution request and had promised to deliver it by hand. The attached affidavits made it clear that the contract was a fake. Some banking documents showed that the money had gone to a Swiss account. And that account, the records indicated, was controlled by Whitacre.

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  Herbst looked over at Spearing.

  “Boy,’’ he said. “I wonder what he’s going to say about all this?’’

  The lawyers gathered gradually at the Chicago U.S. Attorney’s office, on the fourth floor of the glass and steel Dirksen Federal Building. Lassar played host, escorting Herbst and the Fraud Section prosecutors to a conference room across from his office. Nondescript art prints adorned the walls on either side of a huge cabinet stuffed with law books and legal mementos.

  “We’re still waiting for the antitrust lawyers,’’ Lassar said. “They’re going to make a quick presentation to Whitacre and then hand off to you.’’

  A short time later, Jim Griffin showed up with Robin Mann. They chatted while waiting for Whitacre’s arrival. The call came in soon after.

  “They’re here,’’ Lassar said.

  As he neared the conference room, Jim Epstein could not shake a terrible sense of foreboding. All weekend, he had pressed Whitacre on his story. But his client swore up and down that he was telling the absolute truth. The government, he kept saying, needed to hear it. Now, Epstein and his partner, Bob Zaideman, were on either side of Whitacre, but still their client seemed alone in his thoughts. Epstein was heading into the conference room when he felt a tap on his shoulder.