Victims affected by a deceased financier dubbed the “Bernie Madoff of cows” are taking legal action against three banks, accusing them of facilitating a $100 million Ponzi scheme.
Several individuals deceived by Brian McClain from Benton, Kentucky, have filed a lawsuit targeting Community Financial Services Bank, Rabo AgriFinance, and Mechanics Bank. According to the New York Post, the lawsuit claims these banks overlooked warning signs, causing many Kentucky investors to suffer financial setbacks.
The fraudulent activity came to light just days after McClain, aged 52, took his own life on April 18, 2023. Initially, he had promised investors a 30% return through a “ghost cattle” scheme where the supposed cattle did not actually exist, as reported by authorities.
Cows being fed on a farm. (Salwan Georges/The Washington Post via Getty Images)
After McClain’s death last year, representatives from Rabo AgriFinance seized the remaining cattle from McClain’s operation and sold them through Blue Grass Stockyards.
Three of McClain’s companies — McClain Farms in Benton, Kentucky; 7M Cattle Feeders in Hereford, Texas; and McClain Feed Yard in Friona, Texas — filed for bankruptcy in 2023.
The unpaid livestock sellers could be protected under the Packers and Stockyards Act of 1921, which requires that all livestock purchased by a dealer in cash sales, along with any receivables or proceeds from those livestock, be held in trust for the benefit of unpaid sellers, according to the Department of Agriculture.
McClain’s moniker is named after Bernie Madoff, the former Nasdaq chairman who masterminded the largest Ponzi scheme in U.S. history by defrauding thousands of investors.
Bernard L Madoff following his arrest for masterminging a large Ponzi scheme. (DON EMMERT/AFP via Getty Images)
Madoff died in 2021 at the age of 81 while serving a 150-year sentence at the federal medical care center in a North Carolina federal prison.
