A South Dakota man will spend seven-and-a-half years in federal prison and owe more than $24 million in restitution after orchestrating a "cattle Ponzi scheme."
Robert Blom, a 49-year-old from Corsica, was sentenced recently after pleading guilty to wire fraud and money laundering, according to a news release from the U.S. Attorney's Office in South Dakota. More than 30 other charges were dropped as part of the plea deal.
Blom, who operated a custom cattle feeding business, ran the conspiracy from 2014 through February 2019.
Blom bought, raised and sold cattle for investors. But he sold the same groups of cattle to different investment groups.
He knew he couldn't purchase as many cattle as he said he could, and he told investors that he would use their payments to buy and care for the livestock. But Blom routinely used the money to pay back old investors.
"Because he sold the same groups of cattle to multiple different investor groups, the money generated from the sale of the cattle groups to a processing plant did not generate enough money to pay back all of the investors who invested in those cattle groups," said the news release from the U.S. Attorney's Office.
Blom apologized during the sentencing hearing, saying his actions hurt his family and friends.
