Mark Whitacre
Encyclopedia
Mark Edward Whitacre came to public attention in 1995 when, as president of the BioProducts Division at Archer Daniels Midland
(ADM), he was the highest-level corporate executive in U.S. history to become a Federal Bureau of Investigation
(FBI) whistleblower
. For three years (1992–1995), Whitacre acted as an informant
for the FBI, which was investigating ADM for price fixing
. In apparent retaliation for his role as an informant, ADM investigated Whitacre's activities and, upon discovering suspicious activity, requested the FBI investigate Whitacre for embezzlement. As a result of US$9.5 million in various frauds, Whitacre lost his whistleblower's immunity, and consequently spent eight-and-a-half years in federal prison. He was released in December 2006. Whitacre is currently the chief operating officer
and President
of Operations at Cypress Systems
, a California biotechnology firm.
. He holds B.S.
and M.S. degrees from Ohio State University
, and earned a Ph.D.
in Nutritional Biochemistry from Cornell University
(1983).
, where he was president of the BioProducts Division from 1989 until August 9, 1995.
In 2006, Whitacre was hired by Cypress Systems
Inc., a California biotechnology company, as the President of Technology and Business Development. In March 2008, he was promoted to the company's Chief Operating Officer (COO).
price-fixing scheme. Whitacre's wife pressured him into becoming a whistleblower after she threatened to go to the FBI herself.
Over the next three years, Whitacre worked with FBI agents to collect information and record conversations with both ADM executives and its competitors. ADM ultimately settled Federal charges for more than US$100 million and paid hundreds of millions of dollars more to plaintiffs and customers (US$400 million alone on a high-fructose corn syrup class action
case).
s and money laundering
at ADM. Whitacre was later convicted of embezzling US$9 million; some of this criminal activity occurred during the time he was cooperating with the FBI.
, Whitacre pled guilty, without a trial, to tax evasion and fraud and was sent to prison on March 4, 1998. Although some officials in the FBI and the Department of Justice opposed the length of the penalty, Whitacre was sentenced to ten and a half years in Federal prison—three times longer than his price-fixing conspirators. In December 2006, he was released on good behavior after serving eight and half years.
, a former New York Times reporter, portrays Whitacre as a complex figure: while working for the FBI as one of the best and most effective undercover cooperating witnesses the U.S. government ever had, Whitacre was simultaneously committing a US$9 million white-collar crime
. According to Eichenwald, preceding the investigation Whitacre was scammed by a group in Nigeria in an advance fee fraud
, and suggests that Whitacre's losses in the scam may have been the initial reason behind his embezzlement activity at ADM. (This possibility is discounted by James B. Lieber.)
Eichenwald writes that Whitacre lied and became delusional in a failed attempt to save himself, making the FBI investigation much more difficult. The Informant details Whitacre's bizarre behavior, including Whitacre cracking under pressure, increasing his mania, telling the media that FBI agents tried to force him to destroy tapes (a story that Whitacre later recanted), and attempting suicide. Two doctors later diagnosed Whitacre as suffering from bipolar disorder
. Eichenwald concludes that Whitacre's sentence was unjust because of his mental instability at the time.
Eichenwald, two prosecutors, an FBI agent, and Mark Whitacre (during his incarceration) were featured on a September 15, 2000, episode of the radio program This American Life
about the ADM case. Eichenwald referred to Whitacre's sentence as "excessive and a law enforcement failure" because Whitacre never received credit for his substantial cooperation in assisting the government with the massive price-fixing case.
Eichenwald's account of Whitacre has been called into question by the syndicated columnist Alan Guebert, following the disclosure in August 2007 that Eichenwald paid his sources on another story.
, told The Washington Post
that he had known about Whitacre's frauds for three years” and speculates that Whitacre was fired and turned over to the Federal authorities only after ADM learned he had been working as an FBI mole
. If he knew about Whitacre's embezzlement for three years, Lieber asks, why didn't Andreas fire Whitacre immediately? Lieber surmises: “There were only two logical explanations for Andreas' behavior: either he did not think the funds were stolen (in other words, they were approved) or he didn't care." Based on the fact that other ADM executives committed crimes such as financial fraud by a former treasurer and technology thefts by others, Lieber concludes that fraud was well-known and widespread at ADM during the 1990s. Lieber suggests that ADM would have not turned Whitacre over to the authorities if he had not been a mole for the FBI.
Like Eichenwald, Lieber concludes that Whitacre's lengthy prison sentence was excessive and unjust when one takes into account Whitacre's cooperation in the much larger price-fixing case.
Lieber also poses this question: "Where will the government obtain the next Mark Whitacre after potential whistleblowers observe how Whitacre was treated?"
; several Senators
and Congressmen
; Cornell University
and Ohio State University
professors; Major League Baseball Hall of Famer Harmon Killebrew
; and numerous top executives of corporations.
In 2008, more than ten years after the original conviction, Paisley and two other FBI agents went public with praise for Whitacre. Paisley concluded that "Whitacre's fraud case was minuscule as compared to the ADM case Whitacre cooperated with.” "Had it not been for the fraud conviction," Paisley said, "he would be a national hero. Well, he is a national hero." Paisley added, "Without him, the biggest antitrust case we've ever had would not have been." On August 4, 2009, in a Discovery Channel
documentary, Undercover: Operation Harvest King, several FBI agents stated that "Whitacre got a raw deal." In addition, official letters from the FBI in support of a Whitacre pardon were published in Floyd Perry's September 2009 book, Mark Whitacre: Against All Odds.
feature film released on September 18, 2009. Produced by Jennifer Fox and directed by Steven Soderbergh
, the dark comedy/drama
film stars Matt Damon
as Whitacre. The screenplay by Scott Z. Burns is based on Kurt Eichenwald's book, The Informant, with most of the filming done in Central Illinois (Moweaqua
and Decatur).
Archer Daniels Midland
The Archer Daniels Midland Company is a conglomerate headquartered in Decatur, Illinois. ADM operates more than 270 plants worldwide, where cereal grains and oilseeds are processed into products used in food, beverage, nutraceutical, industrial and animal feed markets worldwide.ADM was named the...
(ADM), he was the highest-level corporate executive in U.S. history to become a Federal Bureau of Investigation
Federal Bureau of Investigation
The Federal Bureau of Investigation is an agency of the United States Department of Justice that serves as both a federal criminal investigative body and an internal intelligence agency . The FBI has investigative jurisdiction over violations of more than 200 categories of federal crime...
(FBI) whistleblower
Whistleblower
A whistleblower is a person who tells the public or someone in authority about alleged dishonest or illegal activities occurring in a government department, a public or private organization, or a company...
. For three years (1992–1995), Whitacre acted as an informant
Informant
An informant is a person who provides privileged information about a person or organization to an agency. The term is usually used within the law enforcement world, where they are officially known as confidential or criminal informants , and can often refer pejoratively to the supply of information...
for the FBI, which was investigating ADM for price fixing
Price fixing
Price fixing is an agreement between participants on the same side in a market to buy or sell a product, service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given level by controlling supply and demand...
. In apparent retaliation for his role as an informant, ADM investigated Whitacre's activities and, upon discovering suspicious activity, requested the FBI investigate Whitacre for embezzlement. As a result of US$9.5 million in various frauds, Whitacre lost his whistleblower's immunity, and consequently spent eight-and-a-half years in federal prison. He was released in December 2006. Whitacre is currently the chief operating officer
Chief operating officer
A Chief Operating Officer or Director of Operations can be one of the highest-ranking executives in an organization and comprises part of the "C-Suite"...
and President
President
A president is a leader of an organization, company, trade union, university, or country.Etymologically, a president is one who presides, who sits in leadership...
of Operations at Cypress Systems
Cypress Systems
Cypress Systems, Inc. is a biotech company headquartered in Fresno, California and is best known for its research, in collaboration with the National Cancer Institute , regarding the use of selenium supplementation for the prevention of a variety of cancers. Cypress Systems, Inc...
, a California biotechnology firm.
Early life and education
Whitacre was born on May 1, 1957 and grew up in Morrow, OhioMorrow, Ohio
Morrow is a village in Salem Township, Warren County, Ohio, United States. As of the 2000 census, the village population was 1,286, up from 1,206 in 1990...
. He holds B.S.
Bachelor of Science
A Bachelor of Science is an undergraduate academic degree awarded for completed courses that generally last three to five years .-Australia:In Australia, the BSc is a 3 year degree, offered from 1st year on...
and M.S. degrees from Ohio State University
Ohio State University
The Ohio State University, commonly referred to as Ohio State, is a public research university located in Columbus, Ohio. It was originally founded in 1870 as a land-grant university and is currently the third largest university campus in the United States...
, and earned a Ph.D.
Ph.D.
A Ph.D. is a Doctor of Philosophy, an academic degree.Ph.D. may also refer to:* Ph.D. , a 1980s British group*Piled Higher and Deeper, a web comic strip*PhD: Phantasy Degree, a Korean comic series* PhD Docbook renderer, an XML renderer...
in Nutritional Biochemistry from Cornell University
Cornell University
Cornell University is an Ivy League university located in Ithaca, New York, United States. It is a private land-grant university, receiving annual funding from the State of New York for certain educational missions...
(1983).
Career
Whitacre was an executive at Degussa and Ralston Purina prior to joining ADMArcher Daniels Midland
The Archer Daniels Midland Company is a conglomerate headquartered in Decatur, Illinois. ADM operates more than 270 plants worldwide, where cereal grains and oilseeds are processed into products used in food, beverage, nutraceutical, industrial and animal feed markets worldwide.ADM was named the...
, where he was president of the BioProducts Division from 1989 until August 9, 1995.
In 2006, Whitacre was hired by Cypress Systems
Cypress Systems
Cypress Systems, Inc. is a biotech company headquartered in Fresno, California and is best known for its research, in collaboration with the National Cancer Institute , regarding the use of selenium supplementation for the prevention of a variety of cancers. Cypress Systems, Inc...
Inc., a California biotechnology company, as the President of Technology and Business Development. In March 2008, he was promoted to the company's Chief Operating Officer (COO).
ADM price-fixing
In 1992, during an ADM-initiated investigation of corporate espionage and sabotage, Whitacre informed an FBI agent that he and other ADM executives were involved in an illegal multinational lysineLysine
Lysine is an α-amino acid with the chemical formula HO2CCH4NH2. It is an essential amino acid, which means that the human body cannot synthesize it. Its codons are AAA and AAG....
price-fixing scheme. Whitacre's wife pressured him into becoming a whistleblower after she threatened to go to the FBI herself.
Over the next three years, Whitacre worked with FBI agents to collect information and record conversations with both ADM executives and its competitors. ADM ultimately settled Federal charges for more than US$100 million and paid hundreds of millions of dollars more to plaintiffs and customers (US$400 million alone on a high-fructose corn syrup class action
Class action
In law, a class action, a class suit, or a representative action is a form of lawsuit in which a large group of people collectively bring a claim to court and/or in which a class of defendants is being sued...
case).
Whitacre embezzlement
A few years into the price-fixing investigation, Whitacre confessed to his FBI handlers that he had been involved with corporate kickbackBribery
Bribery, a form of corruption, is an act implying money or gift giving that alters the behavior of the recipient. Bribery constitutes a crime and is defined by Black's Law Dictionary as the offering, giving, receiving, or soliciting of any item of value to influence the actions of an official or...
s and money laundering
Money laundering
Money laundering is the process of disguising illegal sources of money so that it looks like it came from legal sources. The methods by which money may be laundered are varied and can range in sophistication. Many regulatory and governmental authorities quote estimates each year for the amount...
at ADM. Whitacre was later convicted of embezzling US$9 million; some of this criminal activity occurred during the time he was cooperating with the FBI.
Sentencing and release
Represented by high profile lawyer, John M. DowdJohn M. Dowd
John M. Dowd , an American lawyer. He received his J.D. from Emory University School of Law.-Career:As of 2010 Dowd is a partner in the Washington, D.C. office law firm of Akin Gump Strauss Hauer & Feld.-Pete Rose investigation:...
, Whitacre pled guilty, without a trial, to tax evasion and fraud and was sent to prison on March 4, 1998. Although some officials in the FBI and the Department of Justice opposed the length of the penalty, Whitacre was sentenced to ten and a half years in Federal prison—three times longer than his price-fixing conspirators. In December 2006, he was released on good behavior after serving eight and half years.
Kurt Eichenwald
In his 2000 book, The Informant, Kurt EichenwaldKurt Eichenwald
Kurt Alexander Eichenwald , an American writer and investigative reporter formerly with The New York Times and later with Condé Nast's business magazine, Portfolio...
, a former New York Times reporter, portrays Whitacre as a complex figure: while working for the FBI as one of the best and most effective undercover cooperating witnesses the U.S. government ever had, Whitacre was simultaneously committing a US$9 million white-collar crime
White-collar crime
Within the field of criminology, white-collar crime has been defined by Edwin Sutherland as "a crime committed by a person of respectability and high social status in the course of his occupation" . Sutherland was a proponent of Symbolic Interactionism, and believed that criminal behavior was...
. According to Eichenwald, preceding the investigation Whitacre was scammed by a group in Nigeria in an advance fee fraud
Advance fee fraud
An advance-fee fraud is a confidence trick in which the target is persuaded to advance sums of money in the hope of realizing a significantly larger gain...
, and suggests that Whitacre's losses in the scam may have been the initial reason behind his embezzlement activity at ADM. (This possibility is discounted by James B. Lieber.)
Eichenwald writes that Whitacre lied and became delusional in a failed attempt to save himself, making the FBI investigation much more difficult. The Informant details Whitacre's bizarre behavior, including Whitacre cracking under pressure, increasing his mania, telling the media that FBI agents tried to force him to destroy tapes (a story that Whitacre later recanted), and attempting suicide. Two doctors later diagnosed Whitacre as suffering from bipolar disorder
Bipolar disorder
Bipolar disorder or bipolar affective disorder, historically known as manic–depressive disorder, is a psychiatric diagnosis that describes a category of mood disorders defined by the presence of one or more episodes of abnormally elevated energy levels, cognition, and mood with or without one or...
. Eichenwald concludes that Whitacre's sentence was unjust because of his mental instability at the time.
Eichenwald, two prosecutors, an FBI agent, and Mark Whitacre (during his incarceration) were featured on a September 15, 2000, episode of the radio program This American Life
This American Life
This American Life is a weekly hour-long radio program produced by WBEZ and hosted by Ira Glass. It is distributed by Public Radio International on PRI affiliate stations and is also available as a free weekly podcast. Primarily a journalistic non-fiction program, it has also featured essays,...
about the ADM case. Eichenwald referred to Whitacre's sentence as "excessive and a law enforcement failure" because Whitacre never received credit for his substantial cooperation in assisting the government with the massive price-fixing case.
Eichenwald's account of Whitacre has been called into question by the syndicated columnist Alan Guebert, following the disclosure in August 2007 that Eichenwald paid his sources on another story.
James B. Lieber
In his 2000 book, Rats In The Grain, attorney James B. Lieber focuses on ADM's price-fixing trial and presents Whitacre as an American hero overpowered by ADM's vast political clout. Rats In The Grain presents evidence that the U.S. Department of Justice often subjugated itself to ADM's political power and well-connected attorneys in prosecuting Whitacre. Lieber reveals that, in 1996, "ADM CEO, Mr. Dwayne AndreasDwayne Andreas
Dwayne Orville Andreas is one of the most prominent political campaign donors in the United States, having contributed millions of dollars to Democratic and Republican candidates alike...
, told The Washington Post
The Washington Post
The Washington Post is Washington, D.C.'s largest newspaper and its oldest still-existing paper, founded in 1877. Located in the capital of the United States, The Post has a particular emphasis on national politics. D.C., Maryland, and Virginia editions are printed for daily circulation...
that he had known about Whitacre's frauds for three years” and speculates that Whitacre was fired and turned over to the Federal authorities only after ADM learned he had been working as an FBI mole
Mole (espionage)
A mole is a spy who works for an enemy nation, but whose loyalty ostensibly lies with his own nation's government. In some usage, a mole differs from a defector in that a mole is a spy before gaining access to classified information, while a defector becomes a spy only after gaining access...
. If he knew about Whitacre's embezzlement for three years, Lieber asks, why didn't Andreas fire Whitacre immediately? Lieber surmises: “There were only two logical explanations for Andreas' behavior: either he did not think the funds were stolen (in other words, they were approved) or he didn't care." Based on the fact that other ADM executives committed crimes such as financial fraud by a former treasurer and technology thefts by others, Lieber concludes that fraud was well-known and widespread at ADM during the 1990s. Lieber suggests that ADM would have not turned Whitacre over to the authorities if he had not been a mole for the FBI.
Like Eichenwald, Lieber concludes that Whitacre's lengthy prison sentence was excessive and unjust when one takes into account Whitacre's cooperation in the much larger price-fixing case.
Lieber also poses this question: "Where will the government obtain the next Mark Whitacre after potential whistleblowers observe how Whitacre was treated?"
Clemency or pardon support
Even though presidential pardons are known to require decades after an ex-offender's prison release, appeals for Whitacre's full pardon or clemency to the White House are supported by several current and former justice department officials: Dean Paisley, a retired 25-year veteran and former FBI supervisor on the price-fixing case; two other FBI agents involved with the case; a former Attorney General of the United States; one of the former Asst. U.S. Attorneys who prosecuted Whitacre; two prosecutors from the Canadian Department of JusticeDepartment of Justice (Canada)
The purpose of the Department of Justice is to ensure that the Canadian justice system is fair, accessible and efficient. The Department also represents the Canadian government in legal matters...
; several Senators
United States Senate
The United States Senate is the upper house of the bicameral legislature of the United States, and together with the United States House of Representatives comprises the United States Congress. The composition and powers of the Senate are established in Article One of the U.S. Constitution. Each...
and Congressmen
United States House of Representatives
The United States House of Representatives is one of the two Houses of the United States Congress, the bicameral legislature which also includes the Senate.The composition and powers of the House are established in Article One of the Constitution...
; Cornell University
Cornell University
Cornell University is an Ivy League university located in Ithaca, New York, United States. It is a private land-grant university, receiving annual funding from the State of New York for certain educational missions...
and Ohio State University
Ohio State University
The Ohio State University, commonly referred to as Ohio State, is a public research university located in Columbus, Ohio. It was originally founded in 1870 as a land-grant university and is currently the third largest university campus in the United States...
professors; Major League Baseball Hall of Famer Harmon Killebrew
Harmon Killebrew
Harmon Clayton Killebrew , nicknamed "Killer" and "Hammerin' Harmon", was an American professional baseball first baseman, third baseman, and left fielder. During his 22-year career in Major League Baseball , he played for the Washington Senators, a team which later became the Minnesota Twins, and...
; and numerous top executives of corporations.
In 2008, more than ten years after the original conviction, Paisley and two other FBI agents went public with praise for Whitacre. Paisley concluded that "Whitacre's fraud case was minuscule as compared to the ADM case Whitacre cooperated with.” "Had it not been for the fraud conviction," Paisley said, "he would be a national hero. Well, he is a national hero." Paisley added, "Without him, the biggest antitrust case we've ever had would not have been." On August 4, 2009, in a Discovery Channel
Discovery Channel
Discovery Channel is an American satellite and cable specialty channel , founded by John Hendricks and distributed by Discovery Communications. It is a publicly traded company run by CEO David Zaslav...
documentary, Undercover: Operation Harvest King, several FBI agents stated that "Whitacre got a raw deal." In addition, official letters from the FBI in support of a Whitacre pardon were published in Floyd Perry's September 2009 book, Mark Whitacre: Against All Odds.
Feature film
The Informant! is a Warner Bros.Warner Bros.
Warner Bros. Entertainment, Inc., also known as Warner Bros. Pictures or simply Warner Bros. , is an American producer of film and television entertainment.One of the major film studios, it is a subsidiary of Time Warner, with its headquarters in Burbank,...
feature film released on September 18, 2009. Produced by Jennifer Fox and directed by Steven Soderbergh
Steven Soderbergh
Steven Andrew Soderbergh is an American film producer, screenwriter, cinematographer, editor, and an Academy Award-winning film director. He is best known for directing commercial Hollywood films like Erin Brockovich, Traffic, and the remake of Ocean's Eleven, but he has also directed smaller less...
, the dark comedy/drama
Drama
Drama is the specific mode of fiction represented in performance. The term comes from a Greek word meaning "action" , which is derived from "to do","to act" . The enactment of drama in theatre, performed by actors on a stage before an audience, presupposes collaborative modes of production and a...
film stars Matt Damon
Matt Damon
Matthew Paige "Matt" Damon is an American actor, screenwriter, and philanthropist whose career was launched following the success of the film Good Will Hunting , from a screenplay he co-wrote with friend Ben Affleck...
as Whitacre. The screenplay by Scott Z. Burns is based on Kurt Eichenwald's book, The Informant, with most of the filming done in Central Illinois (Moweaqua
Moweaqua, Illinois
Moweaqua is a village in Shelby County, Illinois, United States, and partly in Christian County, Illinois. The population was 1,831 at the 2010 census.-Geography:Decatur is located at ....
and Decatur).
External links
- October 27, 2009 ABC Radio National interview with Mark Whitacre and author of "The Informant", Kurt Eichenwald
- January 8, 2010 PBS TV Interview with the real informant, Mark Whitacre
- Mark Whitacre's official website
- Re-entry Success Stories including Mark Whitacre
- Government video excerpt which includes actual FBI undercover footage shot by Mark Whitacre
- 9/18/2009 This American Life (NPR) on ADM price fixing case