Ground Zero Seeds Int’l, Inc. (GZI), a Yamhill, Oregon-based grass seed marketing and distribution company, pleaded guilty and was sentenced in a federal court for its role in a scheme to defraud the J.R. Simplot Company and its former subsidiary, the Jacklin Seed Company.
According to court documents, GZI and its president, Gregory McCarthy, maintained longstanding commercial relations with the Jacklin Seed Company, a subsidiary of Simplot based in Liberty Lake, Washington. GZI and McCarthy routinely contracted with Jacklin for the purchase and sale of grass seed.
The scheme, which began in April 2015, involved GZI paying a per pound kickback to Richard Dunham, a former Jacklin employee who oversaw the company’s order-fulfillment and warehousing operations in Oregon. These kickbacks were built into the prices reflected on GZI’s invoices to Jacklin.
Between April 2015 and September 2019, McCarthy caused GZI to pay Dunham approximately $191,790.
Ground Zero Seeds Int’l, Inc. pleaded guilty to one count of misprision of felony and was sentenced to one year of probation. The company was also ordered to pay a $40,000 fine and $516,000 in restitution to Simplot.
This case was investigated by IRS-Criminal Investigation and the U.S. Department of Agriculture Office of Inspector General. It was prosecuted by Ryan W. Bounds, Assistant U.S. Attorney for the District of Oregon.
On April 29, 2022, Dunham was charged by criminal information with two counts of conspiracy to commit wire fraud. He pleaded guilty to both charges on July 7, 2022, and will be sentenced on June 21, 2023.
The exact date of the crime was not provided. However, the scheme began in April 2015 and continued until September 2019.
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Key Facts
- State: Oregon
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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