A federal grand jury sitting in Charlotte has indicted Michael A. Kennedy, 55, of Charlotte, on conspiracy and honest services wire fraud charges, for his role in an extensive bribery and kickback scheme that defrauded his employer, Cargill, announced Andrew Murray, U.S. Attorney for the Western District of North Carolina.
Robert R. Wells, Special Agent in Charge of the Federal Bureau of Investigation (FBI), Charlotte Division and Tommy D. Coke, Inspector in Charge of the Atlanta Division of the U.S. Postal Inspection Service, which oversees Charlotte, join U.S. Attorney Murray in making the announcement.
According to allegations in the indictment, Kennedy was a senior employee within Cargill’s division of strategic sourcing. Choung “Shawn” Nguyen was a procurement manager within the same division and reported to Kennedy. Brian Ewert was co-owner and primary sales representative of WDS, Inc., also known as Women’s Distribution Services, Inc. (WDS), a South Carolina-based company that provided non-raw materials and services to Cargill and its affiliates.
According to allegations in the indictment and information contained in filed court documents in related cases, from 2009 to 2016, Kennedy conspired with Ewert, Nguyen, and others to carry out a fraudulent bribery and kickback scheme.
The indictment alleges that, during the course of the scheme, Ewert provided Kennedy and Nguyen and other Cargill employees with more than a $1 million in cash, gifts, and vacations, in exchange for them, among other things, putting the interests of WDS, and other companies Ewert controlled, ahead of Cargill’s, including by helping to conceal the fact that WDS was overcharging Cargill. For example, the indictment alleges that, as part of the conspiracy, Ewert provided Kennedy and his family with lavish trips that cost hundreds of thousands of dollars, including trips to the Caribbean on Ewert’s private jet and luxury yacht rentals to entertain Kennedy and his family.
Ewert also paid for Kennedy and his family to go to Disney World and took them on ski trips. The indictment alleges that Kennedy and others concealed from Cargill the fact that they had received from Ewert the illicit bribes and kickbacks, in breach of their fiduciary duties to Cargill.
As alleged in the indictment, in early 2016, after others within Cargill began questioning the relationship between WDS and Cargill, Kennedy, Ewert, and others took numerous steps to conceal from Cargill significant overcharging of Cargill by WDS. Cargill eventually discovered the scheme and terminated its relationship with WDS and Ewert and fired Kennedy and Nguyen.
Kennedy had his initial appearance Wednesday before U.S. Magistrate Judge Gwynne E. Birzer in the U.S. District Court for the District of Kansas where Kennedy was arrested. The charges in the indictment each carry a maximum penalty of 20 years in prison and a $250,000 fine.
The charges in the indictment are allegations. The defendant is innocent unless and until proven guilty beyond reasonable doubt in a court of law.
In November 2019, Ewert, Nguyen and Jennifer Maier, the co-owner and Chief Executive Officer of WDS, were sentenced to 60, 41, and 24 months in prison, respectively, for defrauding Cargill.
The FBI and USPIS investigated the case. Assistant U.S. Attorneys Daniel Ryan and Graham Billings, of the U.S. Attorney’s Office in Charlotte, are in charge of the prosecution.