How does a $650 million cattle con crash? Under the creaking weight of a mere 26 cows.
From 2017-2019, a motley trio of Ponzi scammers—Illinois cowboy, Midwest matron, and polished Georgia fixer—hoodwinked investors and burned through $140 million per month at peak mayhem. New money paid old money.
The stunning scam was a madhouse of blind wire transfers, bogus promissory notes, hearty handshakes, and monopoly money. Three prison sentences later, questions linger over who was behind the curtain and where the booty is buried.
Helluva Tale
Built like a brick house and every inch the central Texas cattleman, plain-talking Roye Stephens was not a man to burn. In September 2017, Stephens dialed Marvin Wills and reported the theft of 26 cows.
Special Ranger Wills, long-time veteran of the Texas & Southwestern Cattle Raisers Association, listened as Stephens dropped a “helluva tale,” centered on the escapades of sketchy businessman touting interests in show cattle and legal marijuana: Mark David Ray.
“At first, I thought Roye Stephens was just talking about Mark Ray doing something local, but I could tell something was off—way different than most anything I’d ever heard at the ground level,” Wills says. “Stephens was describing what would become one of the biggest cattle scams of all time.”
“There was a history of cattle dealings between Stephens and Ray, and those dealings weren’t always fruitful, but Stephens kept going back because every deal was almost too good to be true,” Wills continues. “Ray always had a sweetener.”
Stephens paid Ray $75,000 for half-interest in 52 head of Lampasas County cattle which had been trucked to an Oklahoma feed lot. In a nutshell, the 52 cows did not exist—whether in Oklahoma, Texas, or Timbuktu. The transaction was an inventory fantasy. Stephens had been skinned—and his call for justice would be the key that picked the lock on a buck-wild $650 million shell game.
In tandem with Lampasas County detective David Thorpe, Wills began tracing Ray’s tracks across the livestock industry. “The story was wild,” Wills says. “A real cluster. Ray had investors and connections all over the place, and he’d even gone to Russia with the supposed intention to open a packing plant. He was big-time, except nobody really knew what was real and what was fake about him.”
Wills was certain: Ray was up to his neck in crime. “We knew he sold the exact same number of cattle at the exact same weight to packing plants. Impossible. Week to week on the rail with precisely the same numbers? No way.”
In March 2018, after robbing Stephens, Ray was indicted in Lampasas County for “false statement to obtain property” and “theft by deception.” Specifically, the indictment included a damning text sent by Ray, asking Stephens to pay “for cows with calves on them with eggs put in but of course no confirmed. Cows are at Pawhuska Oklahoma. $2,265 per pair plus freight 52 pair.”
A plea? Settlement? Slap on the wrist? Fine?
Rather, an explosion. Ray, 57, arrived for his bond hearing in Lampasas County by flying in on a luxury Beechcraft King Air—over 26 cattle in rural Texas.
“He showed up in a million-dollar airplane,” Wills recalls. “Basically, he may as well have set off a bomb. That’s when we absolutely knew this was much deeper than a handful of cattle. Who was this guy? Who?”
In short time, Wills and Thorpe were seated in an Austin FBI office, spilling their giant cup of tea.
“We started this, and the feds ended it,” Wills exclaims. “To this day, it boggles my mind. The money; the marijuana; the cattle. Still doesn’t all add up.”
Hometown Dust
The man grew money.
Mark David Ray, at least as far back as the early 2000s, wrangled golden cattle deals. A son of Knox County, in west-central Illinois, he loved flash and the fibrous feel of a thick knot of crisp bills.
His scheme? Ray, as president of Berwick Black Cattle Company and director of Source of Champions, offered bang-bang cattle investments with promises of pronto payback plus high interest—sometimes 25% in months.
Operating out of Abingdon, Ill., things were rosy out of the gate. On Jan. 13, 2002, according to a subsequent Illinois State Securities Department investigation, Ray sold a $150,000 “investment contract” to an Illinois cattleman, and 14 days later paid back the $150,000, plus $3,000. On Nov. 7, he sold another “investment contract” for $122,500 and paid back the principal, along with an extra $5,000.17, 21 days later.
A blitz of similar transactions and bigger returns followed, stretching until 2005, when the wheels came off and the investor payments stopped boomeranging. In a nutshell, Ray got pinched and was barred from doing business: “The Respondents (Ray) shall be permanently prohibited from offering and selling securities in the State of Illinois.”
No matter. Ray, an investment prophet, shook off the hometown dust and made tracks for the West.
With no criminal charges filed in Illinois, the Berwick Black Ponzi was a learning lesson. The next go-around, Ray swung for the fences.
Make It Rain
He talked the talk. He played and preyed. He wore boots and jeans.
“Mark Ray knew how to use his background in agriculture and gain trust,” says Joshua Mayes, former Securities and Exchange Commission (SEC) senior trial counsel, Enforcement Division, who spearheaded a subsequent investigation uncovering Ray’s scam. “He would go to cattle shows, compete for awards, and rub shoulders with people who thought he was legit. Salt-of-the-earth farmers, ranchers, business people, and average joes—he fooled them all with a handshake.”
Ray claimed to have mastered the cattle flip, fattening cows in feed lots for crazy money: Give me $500,000 today. I’ll give you $600,000 in eight weeks.
“He was so good at speaking the lingo and moving fast,” Mayes continues. “Literally, within months of meeting people, he’d have them wiring him hundreds of thousands of dollars without so much as a napkin scrawl promising payback—sometimes with no financial statements, no deal transaction firm, and no proof. Just his word.”
Based in Denver, Colo., Ray put a foot in both agriculture and legal marijuana, founding three companies: Custom Consulting, Universal Herbs and MR Cattle. To bolster his phenomenal sleight-of-hand skills, he needed team players: Someone to haul in whales and another to grease the financial skids. Enter old friends Ron Throgmartin and Reva Stachniw.
Throgmartin, living in Buford, Ga., was CEO of Diego Pellicer, a legal marijuana business. He had been in the trenches during Ray’s Illinois cattle Ponzi. Throgmartin became Ray’s general consultant and appeared the part, presenting a credible business front.
Stachniw, who looked like a cross between a PTA grandmother and Sunday school teacher, was an Illinois crony from Knox County. A retired nurse, she knew the cattle industry and was owner and manager of RM Farm and Sunshine Enterprises.
Ray, Throgmartin, and Stachniw steered investors toward high-speed returns on cattle flips, straight business loans, and marijuana investments, typically in the 10-20% range.
What a threesome. They made it rain—as in, $140 million per month at the height of the scam.
“People With Money”
How did the money machine work?
First, Ray’s engine required prodigious amounts of fuel—a tall order considering he essentially had no cattle. Like a Ponzi politician, Ray needed to raise massive amounts of money, steadily sucking in new investors to pay off old investors.
“He had to constantly make deals,” Mayes describes. “The whole train stops if he doesn’t consistently fool new victims. Once he got rolling and got his victims comfortable, he convinced some to let their investments ride: ‘Right now I owe you 124,000, but I have another deal coming up, and you can make it $150,000 if you give me another 3 months.’”
Throgmartin served as Ray’s legitimate business face, keeping track of major investors and drafting emails, texts, and promissory notes to boost the scheme.
Stachniw handled the bank accounts. She ensured Ray avoided bank detection by keeping his name out of transactions. She maintained accounts in the names of RM Farm and Sunshine Enterprises, signed promissory notes, signed stacks of blank checks for use by Ray as needed, and transferred tens of millions as requested by Ray.
According to federal prosecutors, Stachniw “advised Ray and Throgmartin, generally via text message, telephone call, or email, on a near-daily basis, how much money the co-conspirators needed to raise from victim-investors to avoid overdrawing the various bank accounts the co-conspirators used, and exposing the scheme. At times, Stachniw expressed surprise that Ray was able to find victim-investors willing to continue to invest, for example, writing to Ray on or about August 7, 2018, “I can’t believe you are able to find people with money.”
As the Ponzi pyramid climbed, investors unknowingly were wiring other investors. Literally, victim to victim per Ray’s lies. From the SEC report: Ray would instruct Victim A to wire funds to Victim B, telling Victim A that the funds were for the purchase of cattle from Victim B. Ray would tell Victim B, however, that the funds received from Victim A were payment for another cattle trade in which Victim B had previously invested.
“The investors were lulled to sleep,” Mayes explains. “One ranch gets a wire transfer from a second ranch in another state. The first rancher with the incoming money makes an assumption: The money must have come from a cattle deal.”
From late 2017 and continuing through in or around early 2019, Ray, Throgmartin, and Stachniw raised approximately $650 million from victim-investors.
Translated: The Big 3 tapped hundreds of investors for two-thirds of a billion dollars in a mere 17 months.
Lifesavings, Gone
As Ponzi structures reach skyward, they inevitably creak and collapse. No different with Ray’s Jenga tower.
Ray had too many irons in the fire. When Roye Stephens called the law over stolen Lampasas County cattle, what first appeared as a tiny fissure turned into a gaping hole of access for the SEC and federal prosecutors. The SEC filed against Ray, Stachniw, and Throgmartin on Sept. 30, 2019. Federal prosecutors filed an indictment against Ray on Feb 20, 2020, and against Stachniw and Throgmartin On April 22, 2021.
“When we busted them,” Mayes says, “they were moving over $100 million per month, but that’s far from what sticks in my mind. I just remember the victims. At first, the victims didn’t believe it was all a scam. Then their disbelief changed to panic. Lifesavings, gone.”
“When the public thinks of Ponzis, they think of Bernie Madoff and his sophisticated victims. Therefore, the public thinks of a Ponzi as stealing from the rich. That’s not true most of the time, and by no means in this case. These were mainly middle-class victims in agriculture that worked for a lifetime to make a nest egg to invest. Just normal people lured by a high return. And they wind up on the brink of suicide because a good day, maybe the best day, is getting back 25 cents on the dollar.”
Pulling Levers?
Ray took a plea deal and admitted to bank fraud and wire fraud, throwing Throgmartin and Stachniw under the bus, agreeing to testify against both. Throgmartin and Stachniw claimed innocence as victims of Ray’s duplicity. They were found guilty in a jury trial in 2022.
The trio was sentenced in 2023. Ray, 50 months and $23,374,664 in restitution. Stachniw, 72 months, $14,597,335 in restitution and forfeiture of $6,013,370. Throgmartin, 72 months, $14,597,335 in restitution and forfeiture of $1,004,904. The mastermind, Ray, got the least amount of prison time.
“Stachniw and Throgmartin were convicted of being knowing participants,” Mayes says. “Their defense was, ‘We didn’t know it was a Ponzi. We didn’t know what Mark Ray was truly doing.’ The evidence says otherwise.”
(For more on Throgmartin’s defense and his claims about Ray, see his May 2023 YouTube interview.)
What was Ray’s long-term plan? What was next if the scheme hadn’t crashed?
“I don’t think he had a plan at all,” Mayes contends. “I think he just compartmentalized in the moment and kept going. I also suspect he believed that if things got bad, he could just declare bankruptcy, ride it out, and face no charges. It certainly worked the first time in Illinois.”
And where did the money go? The feds tracked a portion: “Despite putting little to none of their own money into the scheme, the co-conspirators transferred substantial amounts of the proceeds of their conspiracy and scheme to themselves for their personal benefit. For example, between in or around 2017 and in or around 2018 alone, Stachniw transferred approximately $9,000,000 traceable to victim-investors to her personal investment accounts, including approximately $1,000,000 in or around August 2018. Throgmartin received more than approximately $3,000,000 over the course of the conspiracy, including at least approximately $800,000 from Stachniw in or around August 2018.”
But what of Ray’s loot? Was it laundered, flipped into the marijuana business, buried in a hole? Was there another figure behind Ray pulling levers?
“He was playing the high life with jets and travel, and there were reports of gambling, and he had to pump lots into the lower parts of the pyramid,” Mayes concludes, “but where the rest of the money really went is unclear to this day.”
While Ray robbed Peter to pay Paul, there was a mountain of cash left over. The SEC report still echoes: Tens of millions of dollars’ worth of investor money is missing and unaccounted for.
For more from Chris Bennett (@ChrisBennettMS or cbennett@farmjournal.com or 662-592-1106), see:
Game of Horns: Iowa Poacher’s Antler Addiction Leads to Historic Bust
How a Nazi-Fighting Oklahoman Rejected NFL Draft and Went Home to Farm
Sisters of Farm Fraud: How 4 Siblings Fleeced USDA for $10M
Tractor Terrorist: How a Forgotten Farmer Attacked Washington with Fertilizer Bombs
Farmer Unearths Lost Treasure, Solves WW2 Mystery
How The Deep State Tried, And Failed, To Crush An American Farmer
Organic Implosion: How Two Grifters Cooked $50M In Fake Fertilizer and Rocked Agriculture
Corn and Cocaine: Roger Reaves and the Most Incredible Farm Story Never Told
