Chris Claypool, the former general manager of Jacklin Seed Co., was sentenced July 7 in federal court to three years in prison for conspiring to commit wire fraud and money laundering for his role in a plot to defraud the J.R. Simplot Co., Jacklin's former owner, and the company's customers, according to the U.S. Department of Justice.
Claypool (right) was charged Feb. 24 in the fraud and money laundering scheme. He waived the indictment and pleaded guilty to all charges.
Under the terms of the plea agreement, Claypool already paid nearly $8.3 million in restitution and has agreed to forfeit nearly $7.8 million in ill-gotten gains. He will face another three years of supervised release after serving his sentence.
According to the U.S. Attorney's Office in Oregon, Jacklin Seed contracted with independent growers for the production of proprietary grass seed varieties and fulfilled orders from a distribution facility in Albany, Oregon. But much of what Jacklin delivered, under Claypool's direction, was not what customers ordered, according to federal documents.
Claypool, 53,oversaw the company's product sales to domestic and international distributors.
The U.S. Attorney's Office says Claypool and other Jacklin employees, upon recognizing shortages of some lower yield turfgrass varieties, began a process of substituting different varieties of seeds and hiding the substitutions from customers with falsified labels and invoices, all to avoid paying premiums to growers that would adversely affect the company's profits and their own careers.
U.S. attorney officials said Claypool's alleged schemes include packaging seed varieties with false and misleading labels, embezzling more than $12 million while posing as a foreign sales partner and conspiring with a travel agency in Spokane, Washington, to inflate costs of his international travel.
Throughout the duration of Claypool's plot of fraud and deception, Jacklin Seed was a division of JR Simplot Co. Jacklin was acquired by Barenbrug in October 2020.
The U.S. Attorney's Office says Claypool and other Jacklin employees, upon recognizing shortages of some lower yield turfgrass varieties, began a process of substituting different varieties of seeds and hiding the substitutions from customers with falsified labels and invoices, all to avoid paying premiums to growers that would adversely affect the company's profits and their own careers. This began in early 2015 and continued at least until 2019, according to the justice department.
Claypool and a colleague directed Jacklin employees to invoice the customers under the original terms of their contracts, notwithstanding the unauthorized substitutions. As a result of this scheme, Simplot has refunded or credited more than $1.5 million to defrauded buyers.
As part of the scheme, Claypool directed Simplot's payment of more than $12 million in "rebates" and "commissions" to entities that were posing as foreign sales partners but were, in fact, fronts for Claypool's co-conspirators in embezzling those funds. The co-conspirators then transmitted part of their illegally conceived windfall from accounts in Hong Kong to real estate investments in Hawaii under Claypool's control. Years later, Claypool sold the real estate and wired the proceeds to investment accounts in Spokane as part of an intricate money laundering operation.