BILLINGS, Mont. – A North Dakota cattle buyer who drove bankers around eastern Montana showing them cattle he falsely claimed were his was convicted Thursday in a $7.8 million scheme to defraud two local credit unions and a bank.
The jury deliberated about an hour and a half in the four-day trial before finding Todd Horob, 40, guilty of all seven counts of laundering the funds between Wells Fargo and Dakota West CU and Wolfs Point FCU in an effort to conceal the scheme.
An investigation by the FBI found that Horob spent money loaned to buy cattle on other things and that he lost more than $2 million in the cattle futures market. Wells Fargo Bank, which loaned Horob $5.8 million, caught on and sent bankers searching for cattle Horob claimed to have purchased with the money. There were only the 60 cows that Horob listed in his bankruptcy petition, not the 6,800 cows he told Wells Fargo he had a few weeks earlier. Horob filed for bankruptcy March 2006 in Billings.
Horob had formed H&J Livestock LLC with his partner and ranch hand, James Johnson, and borrowed more than $2 million from Dakota West CU, based in Watford City, N.D. Horob used Johnson's personal checking account with the Wolf Point FCU to launder money, prosecutors said.
In one instance, Horob used Johnson's account to redirect a Wells Fargo loan of $950,000 to buy 775 stock cows to pay off a loan of $858,543 that H&J had at Dakota West. But no cows were purchased. In another loan, Horob got $950,000 from Dakota West to buy 1,276 steers and provided the credit union with a fake buyer's bill for the purchase. Horob used most of the money for purchases unrelated to livestock.
