NEW YORK — Diane Backis, former accounting manager at Cargill, pleaded guilty on Nov. 28 to stealing at least $3.1 million from the Minneapolis-based company over a 10-year period and causing at least $25 million in losses, according to the Dept. of Justice.
The announcement was made by US Attorney Richard S. Hartunian of the Northern District of New York; special agent in charge Andrew W. Vale of the Federal Bureau of Investigation’s (FBI) Albany Division; and special agent in charge Shantelle P. Kitchen of the Internal Revenue Service-Criminal Investigation (IRS-CI), New York Field Office.
Backis, 50, of Athens, New York, pleaded guilty to mail fraud and filing a false income tax return. While at Cargill, Backis was responsible for accounting functions in Albany related to the company’s grain operations, including creating customer contracts, generating and mailing invoices and receiving and processing customer payments. As part of her plea, Backis admitted that she defrauded Cargill while working in its Port of Albany facility, which receives, stores and sells grain products.
“Backis stole millions of dollars from her employer in a decade-long scheme to enrich herself so she could live beyond her means,” Hartunian said. “She stole money by diverting customer payments to her personal bank accounts and sold grain products for millions less than her employer paid, causing enormous financial losses. Her guilty plea today sends a strong message that crime does not pay.”
As part of her plea, Backis admitted that she stole hundreds of customer payments sent to Cargill totaling at least $3,115,610 and deposited them into her personal bank accounts, the DOJ said. The DOJ said Backis also regularly created fraudulent invoices and mailed them to Cargill’s customers, and the fraudulent invoices charged Cargill’s customers prices substantially less than what Cargill paid to acquire the grain products, causing Cargill significant financial losses.
The fraudulent invoices also directed Cargill’s customers to send payment directly to Backis, thereby bypassing Cargill’s corporate controls, the DOJ noted.
“To hide her activities, Backis made false entries into Cargill’s accounting software to make it appear that customers were paying prices higher than those in her fraudulent invoices and that customers owed Cargill millions of dollars for delivered grain products, only to reverse those false entries,” the DOJ said. “As a result, Cargill lost at least $25 million.”
Backis faces up to 20 years in prison, a three-year term of supervised release and a fine of up to $250,000 when she is sentenced on March 28, 2017. As part of her guilty plea, Backis has agreed to pay Cargill at least $3.5 million in restitution and to forfeit her house in Athens, an investment brokerage account, and her Cargill pension benefits.
Cargill spokesman Pete Stoddart called Backis’ actions an isolated incident by one employee at a single Cargill location. He said the company has audited its controls and trading systems.