Missouri man pleads guilty to $4.7M cattle investment fraud scheme
July 9, 2018
KANSAS CITY, Mo. — A Clinton, Mo., man pleaded guilty in federal court today to a $4.7 million investment fraud scheme in which he defrauded 89 investors who believed they were purchasing cattle for resale at a profit.
Cameron J. Hager, 42, pleaded guilty before U.S. District Judge Gary A. Fenner to one count of wire fraud and one count of money laundering.
Hager, who operated 5A Holdings, LLC, admitted that he engaged in the fraud scheme from July 2015 to September 2017. Hager solicited victims to invest in a "cattle fund" that was used to purchase herds of cattle to be sold later at a substantial profit, although he never actually purchased or intended to purchase any cattle.
Hager received $4.7 million dollars from 89 investors, with investment amounts from $1,000 to $267,000. Hager deposited $394,074 into his business bank account. He also used the proceeds of the scheme, among other things, to make substantial payments on the mortgage of his 46.6-acre residential property (currently listed for sale with an asking price of $899,000), and to purchase a Ford F-150 pickup truck, a Toyota 4Runner, and two Winnebago travel trailers. Under the terms of the plea agreement, all of Hager's interest in that property must be forfeited to the government.
Hager convinced his victims that he was locating herds of cattle that farmers in distress needed to sell. He told them he would use investor funds to buy such herds, then transport the cattle to pastures/feed lots owned by himself or his company, 5A Holdings, where the cattle would be cared for, fattened, and eventually sold to slaughterhouses where Hager had "contacts." Hager consistently represented that these transactions would produce a net "return" of from 23 to 28 percent on each investment.
Investors filed complaints with the Missouri Secretary of State's Securities Division, and that office opened an investigation. Hager sent the Securities Division a written response to the allegations of fraud; in that response he admitted that there were no cattle and that he had made false representations to investors.
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The wire fraud charge relates to emails sent by Hager to a victim investor. The money laundering charge relates to Hager's withdrawal of $21,500 from his business bank account to purchase a Ford F-150 pickup truck. The FBI determined that the money withdrawn by Hager for this transaction was derived from his wire fraud scheme.
Under federal statutes, Hager is subject to a sentence of up to 30 years in federal prison without parole. The maximum statutory sentence is prescribed by congress and is provided here for informational purposes, as the sentencing of the defendant will be determined by the court based on the advisory sentencing guidelines and other statutory factors. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.
This case is being prosecuted by First Assistant U.S. Attorney David M. Ketchmark and Assistant U.S. Attorney Thomas M. Larson. Assistant U.S. Attorney Stacey Perkins Rock is handling the forfeiture. This case was investigated by the FBI and the Missouri Secretary of State, Securities Division.