Mark Whitacre

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Mark Whitacre
Born	May 1, 1957 (1957-05-01) (age 52) Morrow, Ohio
Charge(s)	wire fraud, tax fraud, money laundering, price-fixing[1]
Penalty	>10 yr. in federal prison camp (but served ca. 8 1/2 yrs. for good behavior)[2]
Status	Released
Occupation	COO & President of Operations Cypress Systems, Inc. A California biotechnology company[3][4]
Spouse	Ginger (Gilbert) Whitacre (married 1979)[5][6]
Children	Three adult children[6]

Mark E. Whitacre (born May 1, 1957) is the chief operating officer and President of Operations at Cypress Systems, a California biotechnology firm. He was the President of the BioProducts Division at Archer Daniels Midland (ADM) from 1989 to 1995. Whitacre came to public attention in 1995 when it became known that he had been acting as an informant for the Federal Bureau of Investigation (FBI), which was investigating ADM for price fixing. Whitacre was the highest-level executive to ever become an FBI whistleblower. After ADM discovered his role as an informant, ADM investigated Whitacre's company activities. Having discovered a potential embezzlement scheme, and at ADM's request, the FBI began investigating Whitacre for embezzlement from the company. Whitacre lost his whistleblower's immunity as a result of $9 million in various frauds, and consequently spent eight and a half years in federal prison.

Contents 1 Early life 2 Career 3 ADM price-fixing conspiracy 3.1 Sentencing 3.2 Differing accounts 3.2.1 Kurt Eichenwald 3.2.2 James B. Lieber 3.2.3 Dean Paisley 3.3 Feature Film 3.4 Pardon support from FBI agents and Chuck Colson 4 See also 5 References 5.1 Footnotes 5.2 Bibliography 5.2.1 Coverage in the news media 6 External links

[edit] Early life

Whitacre was born on May 1, 1957, and grew up in a middle class family in southern Ohio. He was the 1975 senior class president at the Little Miami High School in Morrow, Ohio.^[5] Whitacre holds B.S. and Master's degrees (M.S.) from the Ohio State University from which he graduated in 1979 cum laude and "With Distinction" in an honor's combined program, earning both degrees simultaneously within four years^[5] (Lieber 2000,^{[page needed]}). Thereafter Whitacre earned a Ph.D. from Cornell (1983) with a major in Nutritional Biochemistry (minors: Biochemistry and International Nutrition).^[5][7]. At Cornell, Whitacre studied under selenium expert, Dr. G.F. Combs, Jr., and wrote his dissertation on the biochemical role of selenium in the pancreas.^[5][7] He completed his Ph.D. at Cornell in two years (Lieber 2000,^{[page needed]}).

[edit] Career

Whitacre has almost two decades of management experience which include positions as CEO/President^[5](Lieber 2000,^{[page needed]}). Most of Whitacre's executive experience was obtained at Fortune 500 companies (i.e., ADM, Degussa, and Ralston Purina) prior to heading entrepreneurial companies.^[5] Whitacre became the President of the BioProducts Division for ADM (Eichenwald 2000,^{[page needed]}). ADM generates $70 billion in annual revenues. Whitacre was responsible for the BioProducts Division from its inception and it became one of the largest fermentation complexes in the world in less than six years.^[5]Hired by ADM in 1989 at the age of 32, Whitacre was the youngest Divisional President in the history of the company (Lieber 2000,^{[page needed]}). Shortly thereafter, in 1992 at the age of 35, he also became a Corporate Vice President of ADM and an Officer of the company (Lieber 2000,^{[page needed]}; Eichenwald 2000,^{[page needed]}). Furthermore, he was considered the leading candidate to become the next company president according to a 1995 front cover Fortune Magazine article.^[5] His experience is international in scope; he lived approximately four years in Europe. He is fluent in German. Whitacre was also responsible for businesses in Southeast Asia for two large international companies, and traveled to Asia dozens of times conducting business activities^[5](Lieber 2000,^{[page needed]}).

Whitacre joined a California biotechnology company, Cypress Systems Inc., in 2006 as the company's COO & President, Technology & Business Development.^[2] One of Cypress' flagship products is selenium and therefore, the new position takes Whitacre back to his original roots at Cornell University where he researched the biochemical role of selenium in the prevention of diseases. Most of Cypress' research focuses on a variety of cancers. In March 2008, Whitacre was promoted to the company's Chief Operating Officer (COO) and President of Operations.^[3][8]

[edit] ADM price-fixing conspiracy

In 1992, the FBI was brought in to investigate a possible case of corporate espionage against ADM. The espionage case later was found to be groundless, but during their investigation, Mark Whitacre told an FBI agent that he and other ADM executives were involved in a multinational conspiracy to control the price of lysine.^[9] Over the next three years, Whitacre worked closely with FBI agents to collect information and record conversations with both ADM executives and their competitors (Lieber 2000,^{[page needed]}). ADM ultimately settled federal charges for more than US$100 million and paid hundreds of millions of dollars more to plaintiffs and customers ($400 million alone on the high fructose corn syrup class action case).^{[9][10][11][12]}

It was initially Whitacre's wife who forced Whitacre to become a whistleblower in 1992 by threatening to go to the FBI herself if he would not have informed the authorities of ADM's illegal price-fixing activities (Eichenwald 2000,^{[page needed]}). During the price-fixing investigation, Whitacre confessed to his FBI handlers that he had been involved with corporate kickbacks and money laundering at ADM (Eichenwald 2000,^{[page needed]}). He was eventually convicted of embezzling $9 million which occurred while he was working with the FBI.^[1][13] His technique involved setting up a bogus offshore company, having it send ADM a fictitious invoice, and then paying off the bill under his own signature (Eichenwald 2000,^{[page needed]}).

Whitacre's testimony led to internal conflict in the U.S. Department of Justice (Lieber 2000,^{[page needed]}). His FBI handlers argued for lenient treatment in exchange for his crucial role in uncovering the conspiracy, while the Department of Justice grew impatient with his increasingly uncooperative behavior (Lieber 2000,^{[page needed]}). U.S. prosecutors eventually charged Whitacre with wire fraud, tax fraud, and money laundering.^[1]

[edit] Sentencing

Whitacre was convicted for tax evasion and fraud and sent to prison in 1998^[1](Lieber 2000,^{[page needed]}). He received a sentence of ten and a half years in federal prison, three times more than that of his co-conspirators.^[14][15][16] According to the updated paperback version of Rats in the Grain (Lieber 2000,^{[page needed]}), Whitacre was a model inmate and earned several more advanced degrees while he was incarcerated in addition to his Ph.D. level education. Furthermore, Whitacre was a mentor to many individuals in prison and assisted numerous young men in completing their GEDs and college degrees (Lieber 2000,^{[page needed]}). His wife and three children visited him every weekend during his entire eight and a half years sentence^[2](Lieber 2000,^{[page needed]}; Eichenwald 2000,^{[page needed]}).

Several reporters, the author of Rats in the Grain, and some Department of Justice officials disagreed with the harsh ten-year sentence of Whitacre^[2](Lieber 2000,^{[page needed]})^[14](Eichenwald 2000,^{[page needed]}). Kurt Eichenwald, formerly of The New York Times and author of The Informant was one of the harshest reporters regarding Whitacre^[17][18], but he also concluded that Whitacre's sentence was excessive (Eichenwald 2000,^{[page needed]}). James Lieber, who authored Rats in the Grain, painted a much different picture about Whitacre than Eichenwald, portraying Whitacre as an American hero who was overpowered by ADM's vast political clout (Lieber 2000,^{[page needed]})^[16]. Dean Paisley, formerly 25 years with the FBI including his role as the FBI supervisor of the ADM case, has supported a pardon for Whitacre for several years^[2](Lieber 2000,^{[page needed]}). Whitacre served approximately eight and a half years in a federal prison for fraud, price-fixing, and tax evasion.^[1][2] Several current and former FBI and Department of Justice officials continue to support Whitacre and are attempting to obtain presidential clemency or a presidential pardon in return for his substantial assistance with one of the largest price-fixing cases in history^[2](Lieber 2000,^{[page needed]}).

[edit] Differing accounts

[edit] Kurt Eichenwald

The Informant was written by Kurt Eichenwald, a New York Times reporter. Eichenwald portrayed Whitacre as a complex figure who was simultaneously working very hard for the FBI as one of the best and most effective undercover cooperating witnesses the U.S. Government ever had, but also committing a $9 million white-collar crime during the same period of time (Eichenwald 2000,^{[page needed]}). Eichenwald reported that Whitacre lied to the FBI and became delusional in his failed attempt to save himself, these deceptions made the FBI investigation much more difficult, and that Whitacre was suffering from manic-depression, also known as bipolar disorder, according to two doctors who treated Whitacre for several years (Eichenwald 2000,^{[page needed]}). Whitacre was scammed by a group in Nigeria in one of their advance fee frauds (Eichenwald 2000,^{[page needed]}). Eichenwald hinted that Whitacre's losses in the Nigerian scam may have been the initial reason behind Whitacre's fraud activity at ADM, but Lieber disagreed with this possibility in his book, Rats in the Grain (Lieber 2000,^{[page needed]}; Eichenwald 2000,^{[page needed]}). Worst of all, according to Eichenwald, Whitacre told stories to the media about how the FBI agents tried to force him to destroy some of the tapes (a story that he later recanted) (Eichenwald 2000,^{[page needed]}). Eichenwald goes into great detail about Whitacre's bizarre behavior and how he "cracked under pressure", then became extremely manic, stopped sleeping during many nights, was reported to be riding horses numerous times after midnight, and was seen using a gas leaf blower on his driveway during a thunderstorm at three in the morning during 1994 (Eichenwald 2000,^{[page needed]}). Whitacre attempted suicide a few months later (Eichenwald 2000,^{[page needed]}). Eichenwald concluded that Whitacre's sentence was unjust because of Whitacre's mental instability at the time.^[19] Eichenwald, two prosecutors, an FBI agent, and Mark Whitacre (during his incarceration) were featured on a September 15, 2000, episode of the radio program This American Life about the ADM case.^[20] Eichenwald referred to Whitacre's sentence as "excessive and a law enforcement failure" because Whitacre never received credit for his substantial cooperation in assisting the government with the massive price-fixing case.^{[citation needed]}

Eichenwald's account of Whitacre has been called into question by the Peoria Journal Star^[17] following the disclosure in August 2007 that he had paid his sources on another story.^[21]

[edit] James B. Lieber

The other book, Rats In The Grain, by lawyer James B. Lieber, focused more on ADM's price-fixing trial and painted a much different picture about Whitacre than Eichenwald (Lieber 2000,^{[page needed]}). Lieber portrayed Whitacre as an American hero who was overpowered by ADM's vast political clout. James Lieber presented abundant evidence that the U.S. Department of Justice often subjugated itself to ADM's political power and well-connected attorneys in the prosecution of informant Mark Whitacre for fraud and tax evasion.^{[citation needed]} Lieber reported that Whitacre was the highest-level executive ever to turn whistleblower in U.S. history, and that Whitacre never attempted any type of fraud during all of his years of employment prior to ADM (Lieber 2000,^{[page needed]}). Lieber concluded that Whitacre's criminal activity and bizarre behavior were a direct result of the pressures which were placed on Whitacre by the FBI, and that Whitacre's manic-depression became more problematic as a result of working undercover for the FBI (Lieber 2000,^{[page needed]}). Lieber also pointed out that the FBI had much information indicating that ADM former Chairman Dwayne Andreas and former President James Randall knew about crimes going on throughout the company. Yet, the FBI was not allowed to question them. Lieber stated that in 1996, “Mr. Dwayne Andreas told The Washington Post he had known about Whitacre's frauds for three years”. However, Whitacre was only fired and turned to the federal authorities after ADM learned he had been working as a mole for the FBI. If he knew about it for three years, why didn't he fire Whitacre immediately, asked Lieber? “There were only two logical explanations for Andreas' behavior: either he did not think the funds were stolen (in other words, they were approved) or he didn't care,” wrote Lieber (Lieber 2000,^{[page needed]}). Lieber concluded that fraud was widespread and an accepted practice at ADM during the 1990s.^[14] ADM has been under new management for several years (Lieber 2000,^{[page needed]}). Based on the fact that other executives committed frauds at ADM [i.e., financial fraud by a former treasurer and also technology thefts by others] and based on the fact that ADM continued to support them, Lieber concluded that ADM would have not turned Whitacre into the authorities if he had not been a mole for the FBI.^[13] Furthermore, Lieber posed the question of where will the government obtain the next Mark Whitacre after potential whistleblowers observe how Whitacre was treated ? (Lieber 2000,^{[page needed]})^[22] Like Eichenwald, Lieber also concluded that Whitacre's lengthy prison sentence was excessive and unjust when one takes into account Whitacre's unprecedented cooperation with a much larger criminal case.^[19][23] Lieber stated that Whitacre should not have received any prison sentence in return for his "multiple years of unprecedented cooperation" on a much larger case (Lieber 2000,^{[page needed]}).

[edit] Dean Paisley

More recent information (April, 2008) illustrated that the Former FBI Supervisor of the ADM case, Dean Paisley, concluded in several pardon support letters which were sent to the White House that "Whitacre's fraud case was minuscule as compared to the ADM case Whitacre cooperated with”^[2](Lieber 2000,^{[page needed]})^[7][8][24]. This statement was more in line with Lieber's conclusion than Eichenwald's. Paisley further stated that Whitacre should receive a Presidential pardon for his “substantial assistance to the U.S. Government and the sacrifices he made because of the case”.^[2] Paisley had been attempting to obtain clemency (a reduced sentence) for Whitacre with the help of other former and current FBI agents and prosecutor who were involved with Whitacre's case (Lieber 2000,^{[page needed]}). Paisley has now redirected that energy into obtaining a full Presidential pardon for Whitacre.^[2] Paisley added, in several pardon/clemency support letters, that most of the erratic behavior and financial frauds occurred during the same period of time Whitacre was working for the FBI and were a direct result of the pressures placed upon him, in his opinion.^[2] Paisley worked 25 years with the FBI and has spent a lot of his retirement time attempting to obtain clemency or a pardon for Whitacre. He stated Whitacre's sentence was a miscarriage of justice and Paisley is passionate about the U.S. government rewarding Whitacre in some fashion.^[2] In March 2008, Dean Paisley joined Whitacre in Washington, D.C. where they jointly met with government lawyers in order to present strong support for Executive Clemency by all three FBI agents, including Brian Shepard who maintained day-to-day contact with Mark Whitacre during the case, and one of the former prosecutors who worked on the original case.^[3][8] Dean Paisley stated, "Such strong pardon support from several current and former Department of Justice officials is unprecedented."^[8] "Had it not been for the fraud conviction," Paisley said, "he would be a national hero. Well, he is a national hero", Paisley added.^[7][24]

[edit] Feature Film

A Warner Bros. feature film has been produced about Whitacre. The Informant!, a dark comedy film, is directed by Steven Soderbergh and produced by Jennifer Fox, with Matt Damon playing Whitacre.^[15] The script for the movie was written by Scott Z. Burns, based upon Kurt Eichenwald's book, The Informant. Most of the filming was done in Central Illinois (Moweaqua and Decatur).^[25] The film was released on September 18, 2009.

[edit] Pardon support from FBI agents and Chuck Colson

Whitacre has numerous supporters who continue to lobby for a Presidential Pardon or Executive Clemency ^[2](Lieber 2000,^{[page needed]})^[7][24]. According to letters filed to the Pardon Attorney at Department of Justice and to the White House Counsel's office, this position is also strongly supported by Dean Paisley, the former Springfield, Illinois FBI supervisor in charge of the ADM case, who wrote numerous letters to the White House in support of Whitacre.^[2] There is some evidence that then-Chairman of ADM, Dwayne Andreas, exerted undue political influence at the time on focusing the case away from the company and toward Whitacre, according to Lieber, who also wrote several pardon letters in support of Whitacre to the Department of Justice and the White House (Lieber 2000,^{[page needed]}). Dwayne Andreas was a friend of several former U.S. presidents and ADM has donated millions of dollars to both political parties (Lieber 2000,^{[page needed]}).

Whitacre's clemency petition is supported by other FBI agents involved with Whitacre's case in addition to Paisley, by a former Attorney General of the United States, and surprisingly by one of the former Asst. U.S. Attorneys who prosecuted Whitacre.^[2][8] Two of the Canadian Dept. of Justice's prosecutors also wrote to the Attorney General and Pardon Attorney at the Department of Justice in support of a pardon. Furthermore, several Senators and Congressmen, Cornell University and Ohio State University Professors, Baseball Hall of Famer Harmon Killebrew, and numerous top executives of corporations have written the White House in support of clemency.^[2][8] One of the most active in supporting clemency for Whitacre is Chuck Colson, former Special White House Counsel under President Richard Nixon.^[8] Colson is the Founder and Chairman of Prison Fellowship Ministries and has taken a strong interest in Whitacre's case. He has personally taken Whitacre's case to the White House.^[2] Whitacre's clemency petition is unprecedented because of the strong support from the very people who indicted him, stated Paisley.^[8] Paisley further stated in some pardon letters that he visited Whitacre during his incarceration "to say thank you to Whitacre for his substantial assistance to the U.S. Government".^[2] Although Whitacre has been released, Paisley continues to be in contact with the Justice Department and the White House Counsel's Office regarding Whitacre.^[2][3][8]

Numerous plaintiff lawyers, who led the Class Action lawsuits against ADM for price-fixing, have supported Whitacre with several letters to the White House in support of a pardon.^[2][8] It was stated "they absolutely had no case without Whitacre and he should have been commended for his sacrifices on such an historical case".^[2] ADM paid hundreds of millions of dollars-with $400 million alone in the High Fructose Corn Syrup case-to the plaintiffs who ADM defrauded during their price-fixing schemes in order to settle the Class Action lawsuits.^[11] In addition, ADM, the other lysine and citric acid producers, and the European vitamin producers paid more than $1 billion in criminal fines to the U.S. Government because of price-fixing(Eichenwald 2000,^{[page needed]}).

More than ten years later (2008), the former FBI supervisor of the price fixing case, Dean Paisley, with backing from two other FBI agents, went public with praise about Whitacre. "Had it not been for the fraud conviction," Paisley said, "he would be a national hero. Well, he is a national hero." ^[7][24][26] "Without him, the biggest antitrust case we've ever had would not have been", Paisley added.^[7][24][26] On August 4, 2009, a Discovery Channel documentary aired, Undercover: Operation Harvest King, where several FBI agents stated that "Whitacre got a raw deal".^[27] In addition, official letters from the FBI in support of a Whitacre pardon were published September, 2009 in a new book, Mark Whitacre Against All Odds; written by Floyd Perry, a fellow prisoner, this book also looks at the Christian faith of Whitacre's wife Ginger and Whitacre's own conversion in prison.^[28]

[edit] See also

• Antitrust

[edit] References

[edit] Footnotes

[edit] Bibliography

• Lieber, James B. (2000). Rats in the Grain. New York: Four Walls Eight Windows. ISBN 1-56858-142-4. Lay summary. 
• Eichenwald, Kurt (2000). The Informant. Broadway Books, Inc.. ISBN 9-78076790-327-1. Lay summary. 

[edit] Coverage in the news media

• Greenwald, John; Curry, Tom; McWhirter, William (1995-07-24), "Harvest of Subpoenas", Time, http://www.time.com/time/magazine/article/0,9171,983204-1,00.html, retrieved 2009-09-21 
• Henkoff, Ronald; Rao, Rajiv M.; Jaynes, Madeline (1995-09-04), "So who is this Mark Whitacre, and why is he saying these things about ADM?", Fortune Magazine, http://money.cnn.com/magazines/fortune/fortune_archive/1995/09/04/205874/index.htm, retrieved 2009-09-21 
• Greenwald, John; Donnelly, Sally; McWhirter, William (1996-10-28), "The fix was in at ADM", Time, http://www.time.com/time/magazine/article/0,9171,985379,00.html, retrieved 2009-09-20 
• Lubbock Avalanche (1996-12-29), "ADM's lawsuit could hurt company", Lubbock Avalanche-Journal, http://www.lubbockonline.com/news/122996/adms.htm, retrieved 2009-09-21 
• Krebs, A.V. (2000-08-16), "Must reading", The Progressive Populist (Ampersand Publishing Co.), http://www.populist.com/00.16.krebs.html 
• Glass, Ira (2000-09-15), "The Fix is In", This American Life (PRI) (186), http://www.thislife.org/Radio_Episode.aspx?episode=168, retrieved 2009-09-20 
• France, Mike (2000-09-25), "Pulp Nonfiction at Archer Daniels", Business Week, http://www.businessweek.com/2000/00_39/b3700042.htm 
• Calderone, Michael (2007-08-10), "Kurt Eichenwald resigns from Portfolio", The New York Observer, http://www.observer.com/2007/kurt-eichenwald-resigns-portfolio, retrieved 2009-09-21 
• Guebert, Alan (2007-08-19), "ADM case still making headlines", Globe Gazette, http://www.globegazette.com/articles/2007/08/19/business/doc46c7c21b69686043977334.txt, retrieved 2009-09-21 
• Cain, Tim (2008-03-19), "Don't expect 'Informant' hobnobbing", Decatur Herald and Review, http://herald-review.com/articles/2008/03/19/columnists/cain/1030816.txt 
• Ackerman, Ruthie (2008-03-27), "Whitacre's Star Rises Again", Forbes, http://www.forbes.com/2008/03/25/whitacre-adm-cypress-face-markets-cx_ra_0325autofacescan03.html, retrieved 2009-09-21 
• Cain, Tim (2008-04-06), "Behind the inside man: Mark Whitacre, talks about 'The Informant', his time in prison and moving forward", Decatur Herald and Review, http://www.herald-review.com/articles/2008/04/06/news/local/1031549.txt 
• Muirhead, Sarah (2008-06-02), "Whitacre paid ultimate price", Feedstuffs Magazine: pp. 1, 42, 43 
• Cain, Tim (2008-07-03), "The 'other' Whitacre chronicler", Decatur Herald & Review, http://www.herald-review.com/articles/2008/07/04/go/news/1033846.txt 
• Discovery Channel (2009-03-10), "Mark Whitacre - Operation Harvest King", Discovery Channel, Undercover, http://investigation.discovery.com/tv/undercover/episode-guide/episode-guide.html 

[edit] External links

• October 27, 2009 ABC Radio National interview with Mark Whitacre and Kurt Eichenwald
• Cypress Systems' official 2009 biography website of Mark Whitacre
• Prison Re-entry Success Stories including Mark Whitacre
• Video Segment includes actual FBI undercover footage shot by Mark Whitacre + true story of ADM case — from film Fair Fight in the Marketplace