Kurt Eichenwald
Kurt Eichenwald
The Informant: A True Story
ISBN: 0767903269
The Informant: A True Story. Part 2
From an award-winning New York Times investigative reporter comes an outrageous story of greed, corruption, and conspiracy—which left the FBI and Justice Department counting on the cooperation of one man . . .

It was one of the FBI's biggest secrets: a senior executive with America's most politically powerful corporation, Archer Daniels Midland, had become a confidential government witness, secretly recording a vast criminal conspiracy spanning five continents. Mark Whitacre, the promising golden boy of ADM, had put his career and family at risk to wear a wire and deceive his friends and colleagues. Using Whitacre and a small team of agents to tap into the secrets at ADM, the FBI discovered the company's scheme to steal millions of dollars from its own customers.

But as the FBI and federal prosecutors closed in on ADM, using stakeouts, wiretaps, and secret recordings of illegal meetings around the world, they suddenly found that everything was not all that it appeared. At the same time Whitacre was cooperating with the Feds while playing the role of loyal company man, he had his own agenda he kept hidden from everyone around him—his wife, his lawyer, even the FBI agents who had come to trust him with the case they had put their careers on the line for. Whitacre became sucked into his own world of James Bond antics, imperiling the criminal case and creating a web of deceit that left the FBI and prosecutors uncertain where the lies stopped and the truth began.

In this gripping account unfolds one of the most captivating and bizarre tales in the history of the FBI and corporate America. Meticulously researched and richly told by New York Times senior writer Kurt Eichenwald, The Informant re-creates the drama of the story, beginning with the secret recordings, stakeouts, and interviews with suspects and witnesses to the power struggles within ADM and its board—including the high-profile chairman Dwayne Andreas, F. Ross Johnson, and Brian Mulroney—to the big-gun Washington lawyers hired by ADM and on up through the ranks of the Justice Department to FBI Director Louis Freeh and Attorney General Janet Reno.

A page-turning real-life thriller that features deadpan FBI agents, crooked executives, idealistic lawyers, and shady witnesses with an addiction to intrigue, The Informant tells an important and compelling story of power and betrayal in America.
—from the publisher

Video Clip Search is not available for this video.
TRANSCRIPT
The Informant: A True Story. Part 2
Program Air Date: February 11, 2001

BRIAN LAMB, HOST: Kurt Eichenwald, author of "The Informant: A True Story," at the top of your book it says, `The FBI was ready to take down America's most politically powerful corporation, but there was one thing they didn't count on.' What was it?
Mr. KURT EICHENWALD (Author, "The Informant: A True Story"): That the informant, that their cooperating witness, Mark Whitacre, was, for lack of a better term, losing his mind; that there were a series of things that he had done and was about to do, because of his psychological state, that were going to upend their case and ultimately put them in the position of having to go all over the world trying to--trying to put it back together again.
LAMB: Because this is part two, let's go over--of our discussion, let's go over quickly the basics.
Mr. EICHENWALD: OK.
LAMB: Mark Whitacre worked where?
Mr. EICHENWALD: Mark Whitacre worked for the Archer Daniels Midland Company, which...
LAMB: Based where?
Mr. EICHENWALD: ...which is based in Decatur, Illinois. For those who know it, it's--it's usually known for its `supermarket to the world' advertisements, which you see on, you know, "Meet The Press" and "This Week" and other--other news shows that are heavily watched in Washington.
LAMB: What's the time frame of the book?
Mr. EICHENWALD: The time frame of the book is, basically, 1992 through this year, through 2--well, through 2000.
LAMB: And we know of names like Brian Mulroney, Bob Strauss, John Block, Ross Johnson and others who were on the board of ADM. Who runs it today?
Mr. EICHENWALD: Allen Andreas runs it, who's--who's not quite as well-known a figure as his uncle, who ran it throughout most of the events described in this book, which is Dwayne Andreas, who is just a--a--a fellow who is--has been around many years; has had an enormous impact on the political scene, very controversial figure and, you know, has turned up in quite a number of--of events that have taken place, from Watergate down to this event.
LAMB: And the end product of all this? What happened at the end? Who went to jail? How much money was involved in the fines?
Mr. EICHENWALD: Well, the interesting thing is that, ultimately, everybody goes to jail. So--so I--I--you know, as--as complex as the story is, this is a--this is an FBI success story. In the end, Mick Andreas, who is the vice chairman and the--the heir-apparent, son of Dwayne Andreas, goes to jail. Terry Wilson, the head of one of the biggest divisions, goes to jail. Mark Whitacre, the--the informant in this case, goes to jail for a few different crimes, along with a group of other executives caught up in price-fixing, which actually wasn't one of the things that ADM was doing.

This goes back to the--to the dominoes; that ADM named somebody, who named somebody. And ultimately there have been something like half a dozen folks who have gone to jail, far more who have paid criminal fines. As for corporations, this--I mean, this is the biggest white-collar conspiracy ever broken up by the government, I mean, ult--by--by almost any measure. Ultimately, the government's collected some $2 billion in fines, and it's still going.
LAMB: You are from Dallas; been with The New York Times for 16 years; went to Swathmore College. What's your beat at The New York Times?
Mr. EICHENWALD: I have the greatest job in journalism. My beat is very undefined. I'm an investigative reporter and senior writer. I don't have a topic I'm supposed to be working on. I don't have a-an area that is mine, and I'm not allowed to go outside of it. Basically, I'm allowed to sort of roam free and find areas that are worth exploring heavily. So I'll go from antitrust to securities fraud to health care to--to medical research and learning something every step of the way. I--there--there's not a story I pick up that I actually know anything about when I start.
LAMB: How long did it take you to write the book?
Mr. EICHENWALD: I started it in--well, I--I began working on the topic itself when I was at The Times in 1995. I decided to write a book and did a contract sometime in 1998 and was--the--the hardest portion of the book actually wasn't the writing of it. The reporting was--was difficult. But far more than anything else, more than anything I've ever done, the hardest part of it was structuring the book because I made a decision early on that I wanted--I wanted to play a game. I wanted readers to be almost in the same position the FBI was and then, later, in the same position I was of not knowing what's real and what isn't.

To do that, I had to convince readers of a version of reality, which, in fact, is fictitious, and doing that again and again and ag--ultimately, I do it five times, you know, with the fifth version being, `This is the ultimate truth.' But to do that, I had to figure out things like, `Where do you start the story?' Where's a point in the story where the fiction and reality don't cross so heavily that it's obvious there's a problem? That took a number of months actually, literally, diagraming it, figuring out the--the--the flow of each--each narrative and finding where you could no longer cross-you could no longer ignore the crossover.

I mean, for instance, there's a point where ADM comes in and says, `Mark Whitacre, your cooperating witness, stole $2 1/2 million from our company.' Well, that's clearly going to be a crossover point because that's something that--that is a surprise, is a shock. And so that was the kind of thing I was looking to--to--to start at a point where I could, basically, keep the oranges up in the air as long as possible and let people realize how difficult it is sometimes to divine the truth.
LAMB: You open in your prologue, `June 27th, 1995,' just to get some sense of the way you write in the beginning, `The country club of Decatur loomed ahead, and Brian Shepard slowed the pace of his 1994 Dodge Dynasty. Beside him in the passenger seat, Bob Herndon sat in silence, gazing at the club through the'--winda--`windshield. Herndon checked his watch again, although he already knew the time: 6 PM, right on schedule.' How do you know that? How do you know all that happened just exactly the way it did?
Mr. EICHENWALD: Without talking about any specific...
LAMB: Yeah.
Mr. EICHENWALD: ...event, the way the book was done was first thing you do--well, in any narrative non-fiction, what you do is you go back and you look at those items that don't rely on memory: documents prepared at the time, diaries, expense statements. I mean, I can't tell you how happy I am when I find somebody's, you know, receipt from something because that usually has the time and the date printed on it.
LAMB: Where do you get it?
Mr. EICHENWALD: Anywhere you can.
LAMB: I mean, where--where is the m--most of the information that you got for this book? Is there one--I mean, is it at the FBI Building, or is it in Springfield?
Mr. EICHENWALD: It's--there is--there is no one place. There are...
LAMB: Was anybody trying to do this the same time you were?
Mr. EICHENWALD: There was another person who was working on a book about the case. He was focusing much more on the trial and did a lot of--did a lot of presentation of the trial. So we didn't, you know--and I do virtually nothing on the trial, so we really didn't cross paths very much.
LAMB: Now Mark Whitacre came from where?
Mr. EICHENWALD: Mark Whitacre was--was raised in Ohio. He went to--got his doctorate at Cornell, a doctorate in-in nutrition--nutritional biochemistry and was one of these, you know, eager, building-up-the-path fellow who could just seemingly do no wrong, a--a--a kind of guy who you wanted, you know, things to work out for. And he got a job at Ralston Purina; from there, took a job at a German company called Degussa, which is a chemical company.
LAMB: How old is he in this time period?
Mr. EICHENWALD: He's in his 20s, early 30s. And, ultimately, he's m--meeting with ADM to negotiate a deal with Degussa. They're impressed with what they see, and they hire him to run their largest, newest division, their most complex division, the--the-the BioProducts Division, which is going to be the one making, you know, the bacteria-related products.
LAMB: At what age again?
Mr. EICHENWALD: He is around 30, 32 at that point.
LAMB: How big a part of the company is he in...
Mr. EICHENWALD: Ultimate--ultimately, it's going to be, in and of itself, virtually a $1 billion company. I mean, it's--it's--it's-it is the--it's intended to be the fastest-growing element of the company because, if you think about it, what does ADM do for a living? Well, they take corn and they crush it, and they pull stuff out. Well, you know, all you need is a lot of capital, and you can do that. You need to have, you know, what--what they like to call--what businessmen like to call a value-added business, where you're bringing something more to the table. And they looked at bioproducts as the way to do that, and they put in charge of it this extremely young, extremely aggressive, extremely eager executive, Mark Whitacre.
LAMB: Now today how old would he be?
Mr. EICHENWALD: He is 44, I believe.
LAMB: And I know you've visited him at the prison because you talk about it in your book.
Mr. EICHENWALD: Yes.
LAMB: What prison is he in?
Mr. EICHENWALD: He is at the Edgefield correctional facility in Edgefield, South Carolina.
LAMB: What's he like down there?
Mr. EICHENWALD: It's--it's interesting. I mean, I've seen Whitacre over the last five years, and virtually every year I would have in my mind a--a viewpoint of his psychological state. I mean, the fall of 1996, he was a wreck; he didn't know he was a wreck, but I knew that he was--you know, I'm--I'm not a psychiatrist, so I can't say-I can't--I can't give a diagnosis to it, but I knew that he was out of control; that the decisions he was making were not the decisions of a rational human being and that--and that there was something wrong with him.
LAMB: How many times did he try to commit suicide?
Mr. EICHENWALD: Twice, both after--after these events started unfolding. It's in...
LAMB: Why didn't he succeed?
Mr. EICHENWALD: Well, one time he didn't succeed because he was found by a gardener, a fellow who worked for him.
LAMB: Rusty Williams?
Mr. EICHENWALD: Rusty Williams, who was a guy who had worked at the Whitacre estate for--for a couple years and had come to work early to--to, basically, arrange for a car to be picked up by ADM. And when he shows up, he notices there's something funny about the garage; it's locked. He hears something. He throws open the garage door, and-and Whitacre's in there with the car motor running.

The second time there are--the--the officials who witness it are-are questioned whether it was a real suicide attempt, but the second time it was Whitacre had attached--again, attached hoses to the tailpipe of a car, put it in the car and turned on the ga--turned on the motor.
LAMB: Who's Ginger?
Mr. EICHENWALD: Ginger Whitacre is his wife--is Mark Whitacre's wife.
LAMB: What's she like?
Mr. EICHENWALD: Ginger Whitacre is what she seems to be. I mean, it's hard to describe it any other way. She is a--a Midwestern woman, who was raised to believe in all those things that Americans hold dear, and sh--believes in--in `till death do us part' as a commitment and has stood by her husband for these many years.
LAMB: What role did she play in this whole story?
Mr. EICHENWALD: I--it's interesting in a way, and in--and in a way that--that, I'm sure, is very troubling for her. She kind of set everything in motion because Mark Whitacre was telling her, on the day that the FBI was coming to talk to him about this--this supposed phone call from Japan, from this fellow Fujiwara, who was going to-saying that they were--he would--he would take $10 million to reveal who from Japan was sabotaging the ADM plant. Mark told Ginger about this; that the FBI was coming to talk to him about it. He did not reveal that he had made up the whole story of the phone call from Japan.

He was very nervous, very tense, as I think any of us would be if we were about to lie to a federal agent. And she knew something--in the course of those discussions, she learned that there was something else going on at ADM. She learned that there was price-fixing going on at ADM, and she told her husband, `You have to tell the truth.' And Mark was very uncertain, saying, `You don't understand. You know, ADM is far more powerful than the FBI.' And, ultimately, she told him, `If you don't tell them, I will.' And that night the agent, who ended up being the--the first case agent on this, a fellow by the name of Brian Shepard, came out to the Whitacre house to put a tape recorder on their phone to capture any other calls that came from this Japanese executive; again, the calls were fictitious.

And as he's--as Shepard's heading out the door, Ginger says quietly to--to her husband, `Are you going to tell him, or am I?' and, literally, when he won't answer, starts to push past him to go outside. And Mark cuts her off and calls out, you know, `Brian, can we talk for a minute?' And they go out, and they sit down in Shepard's car for many hours, and Whitacre reveals this unbelievable story of criminal activity going on inside of ADM.
LAMB: Who's Brian Shepard?
Mr. EICHENWALD: He's the--the special agent in charge of this case, ultimately code named Harvest King. He was the case agent in Decatur, Illinois. At that point, he was the sole agent in Decatur, Illinois. He remains in Decatur to this day. And he was, you know--well, he's--he's--he's the reluctant hero. I mean, he's a fellow who-who really didn't want this case; didn't feel comfortable, you know, living in a company town investigating the company; really thought that there were--other people should be brought in. And the FBI said, `No. You know, Whitacre has opened up to you. You know, you're the guy to handle it. You know these people. You know this town better than anybody, and we will be there backing you up every step of the way.' Well, in truth, they really weren't.

And, ultimately, this is a case that was largely put together by just three, sometimes just two, case agents: one from Champagne, who retired before it was all over; and another, Bob Herndon, who was assigned to the case six months after it began and followed it through to the end.
LAMB: What role did Bob Herndon play?
Mr. EICHENWALD: Bob Herndon--I mean, everybody sort of fell into--into character. I mean, Shepard became sort of the Whitacre--the Whitacre guy. He was the fellow who was most involved in dealing with Whitacre; all of them were on one level of another, but there's--it's not like Shepard. You know, Herndon never spoke to--to Whitacre, but--but Shepard had the longest relationship with him. So, you know, there would be times when Whitacre would call the FBI office, and he would always--almost always ask for Brian Shepard.

Bob Herndon became the tapes guy, for lack of a better term. He was a fellow who had a fairly good background in undercover investigations using tapes. He--he understood the complexities of the documentation for this kind of case and sat down and decided, you know, `We--we have hundreds of tapes coming in. We need some method of understanding them,' and began doing the summaries of the tapes. So he became the best versed on what was in w--which tape and how it interrelated to other tapes.

But, ultimately, you know--and--and then there was Joe Weatherall, who was the--the--the third agent, sort of the--the gentle giant of the team, who played a very critical role in terms of getting Whitacre to confess to a couple of his most significant lies. The--the--the ones that--that--that Weatherall, in particular, dealt with were getting Whitacre to confess that the phone call from Japan, that the Fujiwara phone call, was, in fact, completely fictitious.

And so each one of these agents played their roles, but it--it wasn't locked in stone. It was all very interchangeable. I mean, there'd be times when they would go to Hawaii, and it was to--to tape some of these meetings, and it was sh--and it was Herndon and Weatherall who were handling--who were handling Whitacre. Or it would be to go to Irvine, California, and it would Shepard and Weatherall who'd be handling the taping. And so, you know, it--it pretty much mixed up a lot, but that--those were their basic outlines of their assignment.
LAMB: When was it the most complicated when it came to the wires on Mr. Whitacre and the taping--the videotaping of the meetings?
Mr. EICHENWALD: The videotaping was always the most difficult. You know, most days Whitacre would go into the office, and he would have, you know, just right in here (indicating jacket's inside pocket) a little--a little tape recorder. And, you know, you could--I've got a phone in here. You can pretty much carry something without it being noticed. And he would clip the microphone to the inside pocket. Nobody would--nobody would know the better. That caused problems because, you know, if you go like this (moves jacket), you--you've ruined the sound. And so they branched out.

They gave him a--a notebook folder, which had a tiny, white toggle switch on it that when you t--you know, when you slit it, a--a micro cassette recorder hidden behind a plastic map would start recording. They gave him a briefcase recorder, which, again, you know, he had his little method of, you know, touching the latches. And the recorder, which was hidden in a false top, would start recording. They sewed recorders into his suit, with the wires trailing down into his--into--into his pocket. They strapped recorders onto his back.

Now, again, this was not at all times, but it was--for the particularly important meetings, they would make sure he was double-, triple-taped because the last thing they would want to do is have, you know, a really important meeting that didn't go--that didn't get recorded. Then when they would have meetings in the United States, where the FBI had authority, they would attempt to tape them-those are pictures from some of the tapes. They would move these-these lamps that had--you know, smoke green lamps that had hidden inside them the--the video camera, which would record everything that was going on.
LAMB: Who's meeting in these rooms?
Mr. EICHENWALD: In that meeting, that's the meeting in Irvine, California. The two executives on the left--let me see, which picture are we looking at? The two executives on the left are from-are from--are the s--are senior executives from a company called Ajinomoto, which is a Japanese competitor of ADM in the business of making lysine. The fellow, basically, in the center on the right side is Mick Andreas, who is--who is leading this meeting.
LAMB: Who's now in jail.
Mr. EICHENWALD: Who is now in jail. And the fellow to his immediate right is Mark Whitacre. I think you can see his briefcase--Whitacre's briefcase in that picture. Whitacre has multiple recorders there.
LAMB: Right up at the--on the edge there by his elbow?
Mr. EICHENWALD: Right. And it's--that recorder is taping. He has a recorder on his body that is taping. The video is taping. But as you can imagine, that's a really difficult thing to set up. I mean, you can't just grab any room and say, `Well, we'll tape here,' because the FBI has to be nearby to operate the camera; they operate it by, you know, microwaves. There was a room they had in Hawaii at one point where--it was just a cavernous room, and the next room was separated just by a sliding screen. Well, you know, it didn't take much imagination to think somebody might open the sliding screen and see a bunch of agents sitting over there with headphones on watching a monitor. So they had to make a last-minute adjustment.

I mean, that's--one of the things that's sort of interesting about--about the book, about "The Informant," is--is how-how difficult it is to do something that seems, on its face, to be so simple. Well, you just, you know, stick a camera there and--and you tape these guys, but it doesn't work that way. It's an enormous amount of--of planning, enormous amount of--of problems, things that can go wrong. And it's funny...
LAMB: You k...
Mr. EICHENWALD: ...in this story, whenever there's something that can go wrong, it usually does.
LAMB: And you keep talking about the fact that, in order to get the foreigners to commit an antitrust violation, you had to get them in the United States.
Mr. EICHENWALD: Yes. That was a very big problem.
LAMB: And did they videotape any meetings overseas?
Mr. EICHENWALD: They did not because they--they couldn't get the authority. The FBI cannot walk--go to Tokyo and--and turn on a recorder, a video recorder or an audio recorder. They need the authorization of the Japanese National Police. They were allowed to re--audio record using Whitacre's FBI recorder one time in Tokyo. The second time, the--the--the Japanese changed their position, and they said...
LAMB: Because they were protecting the companies?
Mr. EICHENWALD: I'm--there--there was never any explanation given why. They may have grown uncomfortable because what--what they did is say, `You can't use an FBI recorder, but your witness can use his'--what they called his businessman's recorder. So they ended up getting the tape, but it was--it had to be off of a--off of a recorder that Whitacre himself purchased.
LAMB: All along, what is Mark Whitacre trying to do, and who is giving him instructions?
Mr. EICHENWALD: Well, the first question's a lot harder than the second. Whitacre is trying to do a lot of things. In the context of the FBI investigation, Whitacre is trying to capture the crime. You--you can't just have people discussing, `Gee, wouldn't it be nice to fix prices? Gee, wouldn't it be nice if we were able to reach an agreement where we do this.' The crime is the agreement. There's no--th--there--you know, conspiracy to commit an antitrust violation is really--you know, I don't think I've s--ever seen such a charge.

And so they wanted the agreement on tape, and they drilled into Whitacre's head, you know, `Get the agreement, get the agreement, get the agreement.' They also drilled into his head getting people to repeat things that they had already said that hadn't been taped, and o a lot of the conversation becomes Whitacre talking about, `Well, ou remember that time when we were in Vancouver, and we agreed--and hat was the number we agreed on?' And--and it--it was--it's--it's very interesting to watch his evolution as a cooperating witness because he becomes amazing. I mean, he is--every agent who's ever reviewed this has said he's one of the best cooperating witnesses, just in terms of the evidence he's producing and how he's handling it, that they've ever seen.

And, I mean, one of the interesting things--we were talking about getting the Japanese to the United States so that the FBI could tape. You know, ultimately, they decided the way to do that was--and, again, it sounds laughable--to lure them with the prospect of a--of a golf game, a golf game on a really nice golf course. And it becomes Whitacre's job to do this rather far-fetched thing; you know, get people to commit a crime in a country where the enforcement isn't particularly strict by saying, `Hey, we'll play golf.' And in the course of that conversation, the first of those conversations, Whitacre not only gets the fellow to confess, `Well, the reason I don't want to come is because the antitrust laws are so strict,' which, you know, is a very important piece of evidence...
LAMB: Help...
Mr. EICHENWALD: ...but he ultimately dangles the golf game.
LAMB: Help with this and--Mick Andreas, who was the vice chairman of the company and was sent to jail for three years or whatever-Mark Whitacre--he wouldn't be in jail if Mark Whitacre hadn't done this, and Mark Whitacre gets 10 1/2 years and--and a fine of $11 million and is in jail in South Carolina. How did that happen; that Mark Whitacre got far more in this in the way of penalties than Mick Andreas or Terry Wilson?
Mr. EICHENWALD: It--it's a complex question on some levels. On some levels it's very simple. The simple answer to it is Mark Whitacre committed other crimes. While he was working for the FBI, Whitacre was simultaneously embezzling millions of dollars, $9 million, from ADM, and laundering it into Swiss and Cayman Islands and Hong Kong bank accounts. So when you stand back and look at it, say , `Well, he committed other crimes, he--he gets another sentence.' That, in turn, caused a waiver of his cooperation agreement. He committed crimes he wasn't supposed to. So they also prosecuted him on price-fixing charges, which is a--a very uncomfortable outcome.

Now the problem with this case, ultimately, was that it wasn't treated like a normal criminal case. Cooperating witnesses go bad all the time, you know. This is not unusual. The--the--in fact, the--the US attorney from Chicago, who was directly involved in this case, Scott Lassar, at the very time they're finding out Whitacre has `gone bad,' in law enforcement terms, had another case, using another cooperating witness who'd been working for the FBI, and it had just emerged that he had committed crimes while working for the FBI. Same thing.

Usually what is done, is the people running the case go in and cut a deal. They cut a deal where they say, `OK, you've committed crimes, you've been doing this cooperation, we will cut a deal. We will take into account your cooperation, but now is the time to do it.' Well, what happened here was the Justice Department in Washington just--there's no other way to describe it than to say, was so surprised that a cooperating witness would engage in criminal activity that they created what, from everyone I've spoken to, sounds--is an unprecedented situation where the cooperating witness is being investigated by completely different people than he was working with. You don't have the ability to say, `Look, we have a long-term relationship. Why don't you just tell the truth?'

And so ultimately, Whitacre, who by then, anybody would understand, is not mentally balanced--I mean, the man had, you know--was--had, very soon after--after his role in the--in the money s--money scam came out, was attempting suicide. Whitacre just spins completely out control, and you know, most smart criminals know when to lay their hand down and say, `OK, let's cut a deal.' Whitacre somehow or other became convinced that he could force the government to back down. And there's no doubt in my mind that is a sign of his mental illness, and in the end, he never takes a deal, and it's--what's so funny is, it's--the thing that make him so--so odd at the end, the thing that make him so re--that ma--the things that make him so reckless at the end, that lead to his 10 1/2-year sentence, are the same things that made him reckless enough to become a cooperating witness in the first place.

So the outcome in this, you know, the disparity between Whitacre's sentence and Mick Andreas' sentence, while on one level it's understandable, on another level, I--I really view it as a--as a law enforcement failure. I mean, they have a cooperating witness who brought in one of the biggest white-collar cases, or the biggest white-case, ultimately, in history, who got absolutely no credit for it.
LAMB: How many times did Mark Whitacre lie?
Mr. EICHENWALD: Countless.
LAMB: Did he lie to you?
Mr. EICHENWALD: Yes, many times.
LAMB: Did he lie near the end? I mean, did--did he lie to you when you saw him the last time you were in...
Mr. EICHENWALD: Yes.
LAMB: ...at the prison?
Mr. EICHENWALD: Yes, he did.
LAMB: What'd you say to him? When was this? When was the last time you saw him?
Mr. EICHENWALD: Last time I saw him was in the--I think, February, March, April 2000, and that was a point--by that point, Whitacre--Whitacre had told a story prior--wo--once his money scam was known, Whitacre had told a story that was very believable, given the context of everything else that was being heard about ADM. The story was that he hadn't stolen the money, but ADM had provided it to its executives as an under-the-table bonus scheme, and, you know, there were--there were things out there that made this look possible.
LAMB: How would it work?
Mr. EICHENWALD: It would work that you would get an executive who would be caught up in some criminal enterprise, say, price-fixing. You don't want to give them a reward for, you know--hey--you know, go to the board, `Hey, can you give him some money? He's been really fixing prices well.' Instead you--you would give them this under-the-table bonus to offshore corpora--you know, to an offshore corporation they founded, the money ultimately going to a--to a Swiss or Caymans bank account.

Now this, as bizarre as it sounded, also--it could not be dismissed. It--you know, you--you had a company--you know, there were stories coming out of the company that ultimately proved to be true, that they were looking at hiring prostitutes for--to engage in corporate espionage. I mean, you can't delineate truth and fiction in this story by what makes sense. And so the under-the-table bonus plan was a story that the FBI pursued, that a lot of reporters pursued. There are to this day people who firmly believe it is true, and ultimately, when I reviewed all of the bank records, when I reviewed all of the records that emerged from the--from these multiple investigations, spoke to as many people as I could, there were a lot of problems that emerged. The biggest of the problems was that so much of the money ultimately--even if it went to other executives that Whitacre named as being involved in the scheme, later ended up in Whitacre's bank account. It was--you know, they were more cutouts than anything else.
LAMB: Does he have any money left?
Mr. EICHENWALD: I don't think so.
LAMB: Where does his wife live?
Mr. EICHENWALD: She lives in South Carolina.
LAMB: How do they afford to live?
Mr. EICHENWALD: She is working. She went back to school and got her teaching degree.
LAMB: How many kids to they have?
Mr. EICHENWALD: They have three children, only one of whom is still of school age.
LAMB: And she's sticking with him through all this.
Mr. EICHENWALD: Absolutely.
LAMB: Was he sane when you saw him?
Mr. EICHENWALD: That's the interesting thing. He was--he was more--he continued telling his stories. I presented him with the evidence of--that he was lying. He would throw things back in my face--for example, Dwayne Andreas had said something to The Washington Post a few years back, that some people took as evidence, that he knew of the embezzlements, you know, three before it was revealed, and once you know the full scope of the story, you understand the Fujiwara story, what he's saying makes more sense.

Whitacre finally, as I sort of stacked piece on piece--it was when he said, `This individual s--you know, told me that he knew about it,' I had that individual's grand jury testimony, and I said, `Well, Mark, you know, I've read the grand jury testimony, and he clearly supports you. But what he says really happened was something different.' He then said, `Fine. The only other person I've told this to is my wife, but I'll tell you.' And he proceeded to admit that the under-the-table bonus scheme was a lie.

Now the interesting thing of all this--I mean, I--I've never had such an interesting relationship with an individual who I'm covering, because ultimately, Whitacre's breakthrough at that point in telling the truth, he seems to have found enormously relieving. He's--I mean, if you think about it, living lies for five years is very--or eight years, actually--is very difficult, and now the ability to tell the truth, he seems--in--in a controlled environment, he seems far more balanced, far--far more like just a normal guy than he ever did before.
LAMB: He even lied on his resume about--he didn't have a master's degree, and he didn't get a...
Mr. EICHENWALD: Well--i--there was--there was something that went out from ADM to Milliken University when Whitacre was named to the board there, and on it, it said he had a--a degree from a--I forget which school. It was a Chicago business school, and I think it was-I think it was--I think it was Northwestern, and he didn't. He had a business degree from a mail-order--you know, correspondence--correspondence school.
LAMB: There's a lot of little stories in there, as you well know. Nigeria comes into this.
Mr. EICHENWALD: Yes.
LAMB: I remember those schemes. Never had it pitched to me, but I mean, everybody's gotten one in the mail. What's--how did Nigeria play a role in this?
Mr. EICHENWALD: Well, Nigeria--the sort--I mean, sort of do the prologue first. My favorite part of this whole story is that if you think about it, if it wasn't for a bunch of Nigerian con men sitting off in--in Lagos faxing letters, hoping to find a gullible-this multi-billion dollar price-fixing scam never would have been uncovered. What happened was, Nigerians sent out this letter--it's a very famous scam--where they--they pretend to be people in the Nigerian government, particularly in the oil ministry, and they say, `We have done a series of bogus foreign contracts, and have stashed tens of millions of dollars, $65 million, $75 million, in accounts in Nigeria. But now we need to pay them out, and to do this we need an overseas bank account. If you'll give us your overseas bank account, and letterhead, we will share the proceeds with you and give you 50 percent,' or whatever.

Most people get this and see it for what it is, which is a con, because if you start heading down this path, if you say, `Wow, I'm really excited,' the first thing they tell you is, `Gee, we need money for bribes,' and the demands for money start coming as they dangle this $30 million payoff, and ultimately you either run out of cash or catch on that there's no money coming, ever.

Well, one of the people who fell for this was Mark Whitacre. He received a fax, believed it was true, sent money to Nigeria, convinced some of his friends to send money to Nigeria. When they ran out of money, got money out of ADM by doing the very thing the Nigerians had been talking about, bogus contracts with bogus--with bogus foreign corporations, and shipped that money to Nigeria. See, the first $800,000 of what was taken from ADM went to Nigeria. And then realized it had all been a con, that he had just lost, you know, almost $1 million and he had given guarantees to the other people who put money in. and what's so funny, he gave people guarantees of money they put in that they stole from ADM. And so they turned around and got more money out of ADM to compensate themselves for their losses.

The--the--the endpoint to all this--and this is what the-the prosecutors believe is the ultimate truth--Whitacre at that point-now Whitacre denies this, but the prosecutors say it and it certainly does fit the facts. Whitacre at point decides to go to get his millions and comes in and says, `Hey, I got this call from a Japanese executive named Fujiwara, who says that we have a saboteur, and he'll tell us who it is for $10 million, if we pay it to a Swiss bank account.' Well, Whitacre has a Swiss bank account, and the prosecutors believe that that was Whitacre's effort to get his millions that he didn't get from the Nigerians. I mean, this is the--it's very funny, because somebody called this book `John Grisham on acid.' I mean, it is very, in some ways, convoluted. It's cons within cons within cons, and circles within circles.
LAMB: This is a strange little story. What's--I'm not even sure he pronounces it this way--this way--lamet-vov?
Mr. EICHENWALD: The Lamet-Vov.
LAMB: You've used `lammet' instead of the French pronunciation.
Mr. EICHENWALD: I--yeah.
LAMB: What is The Lamet-Vov?
Mr. EICHENWALD: The Lamet-Vov...
LAMB: L-A-M-E-T--new word, V-O-V.
Mr. EICHENWALD: The Lamet-Vov is--when--when this story began, very shortly afterwards, shortly after the raids, faxes began to arrive at the home fax numbers of some very powerful people, of Dwayne Andreas, of members of the board, of the Mulroneys of the world--which were addressed to the ADM board, from the ADM shareholders' watch committee, and these faxes would make a series of allegations about what was on the tapes, and many of them were--were--many of the allegations, what was on the tapes, were pretty much on target, ult--ultimately proved to be on target--and they were all signed by `The Lamet-Vov.'

Now this was something that nobody--I mean, you know, people handle white-collar cases all the time--nobody had seen a circumstance where they're getting these letters coming in from something they can't even figure out what it is. Some lawyer goes off to the library and starts looking up what is The Lamet-Vov and finds up--finds a reference with slightly different spelling--The Lamet-Vov Zaquitem I think it is, which is something out of the Babylonian Talmud that refers to the 36 righteous individuals who exist in every generation, who are there to point out evil, and so that seemed to fit the portrayal. Now the-the pursuit was, who is The Lamet-Vov, and--and he ended up being a--a-an individual in Florida who was a very--he was very aggressive, a very firm believer in--in--that there was wrong--that there was widespread wrongdoing at ADM. He was a shareholder who, as he told the FBI, was exercising his constitutional rights to express his opinion and have the management of ADM changed through any lawful means, and planned to continue to do so.
LAMB: Did you talk to him?
Mr. EICHENWALD: That's another one of those questions that I can't answer.
LAMB: How is it that--this is the largest--at the time--price-fixing case, anti-trust case in the history of government prosecution...
Mr. EICHENWALD: Yes.
LAMB: ...to a corporation? How is it that the chairman of the board, Dwayne Andreas, continues to serve on the board and is the chairman emeritus, and that Brian Mulroney and other board members-Bob Strauss, all of those people survived this kind of a crisis?
Mr. EICHENWALD: Well, Mulroney--Mulroney and Bob Strauss--I mean, the members of the board were--you know, acted as members of the board. They--they formed a committee, they settled the case.

As for Dwayne Andreas and--and--and other people in the company-one of the things that was most atrocious, to me, about this case was after the board viewed--or the board's representatives viewed the videotapes, where Mick Andreas and Terry Wilson are clearly engaged in criminal activity, they didn't go back home and demand that these guys resign. You know, they waited until after the settlement. That was almost a year, and so they left people in there that they knew were engaged in criminal activity. Now that's a problem--that's a problem for the shareholders of ADM. That's something they need to be asking themselves. Why didn't these people get tossed out?
LAMB: How do you...
Mr. EICHENWALD: Any--anybody else would have been.
LAMB: How can you deal with it, though? One of the things your book does is show how intertwined the FBI, the Justice Department, the anti-trust division, the fraud section of the--you know, all these--the criminal division, all that stuff--how do you--if you're a stockholder, how do you ever get to it?
Mr. EICHENWALD: You know, the answer to that, I have no idea, because it is difficult. I mean, you know, directors have to take their jobs seriously. On some levels, the directors of this--of this company did take their jobs seriously. On other levels, I don't think they did. I think--and I think the most glaring example of that is the failure to remove Mick Andreas and Terry Wilson after they were aware of the ev--of the evidence against them.
LAMB: But you have a whole other part of this book where you set up the l--lawyers, and the relationship between the Williams & Connolly law firm of Washington, DC, the old Will--Edward Bennett Williams firm, and they represented ADM, and then the lawyer that represented--and it--you can explain that--the lawyer that represented them...
Mr. EICHENWALD: It's--it's--it's very convoluted, ...(unintelligible).
LAMB: ...the committee.
Mr. EICHENWALD: Williams & Connolly is representing the board and the special committee, and Simpson Thacher is representing the special committee. I mean, there were times I was talking to people--like, who's really representing who? It really wasn't clear. Ultimately...
LAMB: Who--who is this man from Williams & Connolly?
Mr. EICHENWALD: That is Aubrey Daniels III.
LAMB: Why is he famous in--in our history?
Mr. EICHENWALD: He was the prosecutor of Lieutenant Calley, the-the person who led the attack on--massacre--at My Lai.
LAMB: Who did he represent in all this?
Mr. EICHENWALD: He represented ADM, and he...
LAMB: Who's this fellow right here?
Mr. EICHENWALD: That is Richard Beatty, who is the chairman of Simpson Thacher, who represented the special committee.
LAMB: Where are they located?
Mr. EICHENWALD: They are located in New York, and...
LAMB: So you had the board's special committee represented by Richard Beatty, and the company represented by Aubrey Daniel III...
Mr. EICHENWALD: That's the best way I ever heard it described. But ultimately, it's like, `Who is the company?' I was very--one of the stranger questions was, `Who does Aub--who does Williams & Connolly actually represent?' And I--and I always had trouble with that, because it...
LAMB: Stockholders?
Mr. EICHENWALD: Well, it--no, because if Simpson Thacher is representing the special committee--I mean, it could be dual representation, but it was a very odd circumstance, where even the people involved weren't exactly sure, and in the end, Williams & Connolly was--Williams & Connolly is a very aggressive law firm, and they took the tack of `Be aggressive; fight this to the death.' Beatty, from Simpson Thacher, was the first one allowed to view the videotapes, and he was one who looked at the circumstance and said, `We got to cut a deal.' And there became--one of the--one of-the thing that's most interesting, when Beatty--Beatty is a--is a lawyer with a reputation, you know, second to none, and he comes in advocating, `We have to cut a deal,' and suddenly these conspiracy stories start emerging from--from ADM, particularly from the Andreas family, that Beatty, whose other--whose--whose biggest client is Henry Kravis of Kohlberg, Kravis, Roberts & Company--that Beatty is trying to cripple ADM with a settlement in order to set the company up for a takeover by Henry Kravis--bizarre, to me.
LAMB: I got to ask you, then, about something that our audience has brought up on occasion on our call-in shows. The Bilderberg Group comes up in all this...
Mr. EICHENWALD: Yes.
LAMB: ...David Rockefeller and Dwayne Andreas and Henry Kravis and the meeting in Toronto. What's that about?
Mr. EICHENWALD: The Bilderberg Group, which is this-is this--probably the focus of more conspiracy theories than--than-than I would want to count, is this organization of world leaders who go into nice big secret meetings to talk about economic trends globally and political issues globally, and Dwayne Andreas was a member of the Bilderberg Group, as was Henry Kravis, and they were in this meeting in Toronto at whi--and by that point...
LAMB: Who is Kravis, by the way?
Mr. EICHENWALD: Kravis is the chairman of a leveraged buyout company called Kohlberg, Kravis, Roberts & Company. They became famous-they were the ones who bought RJR Nabisco in--in the takeover deal that was chronicled in "Barbarians at the Gate," so...
LAMB: And Ross Johnson is on the board...
Mr. EICHENWALD: Right.
LAMB: ...of Archer Daniels Midland, and who is he in relationship to all of this?
Mr. EICHENWALD: Right. Ross Johnson was the chairman of--of--of RJR Nabisco, Dick Beatty was the lawyer advising Henry Kravis. I mean, it's funny, it's like a lot of the characters from "Barbarians at the Gate" reappear here. But at this meeting in Toronto, Andreas took it as his opportunity to confront Kravis with his suspicions, and so he walks over and corners him, and says, you know, `Are you trying to--are you trying to take over my company?', again, the idea being that Beatty's structuring a deal, a settlement so that--so that it'll cripple ADM and set Kravis up to take it over. It's like-Kravis says, `No,' and, you know, the two men part ways, and--and Andreas still isn't convinced, but, you know, that was--that was their little confrontation.
LAMB: As you know, we'll never get it all in, and we've almost talked for two hours. What's the reaction to this by people that you know around ADM and the Andreases to your book?
Mr. EICHENWALD: A number of interesting reactions; in Decatur, I-I went out there and there was a--there was a wonderful discussion I had--actually, it was on C-SPAN 2--with the folks at Decatur about the book, and I heard a lot of things from a lot of people about how this was really how things happened. The--I have heard from the Chicago US attorney asking me, you know, `You have a lot of things you're not supposed to have. How did you get them?'I heard from people in the FBI thanking me for getting the story right. On the other hand, I've also, you know--I haven't heard personally, but I've--I've seen letters--The Lamet-Vov, the fellow who we talked about earlier, is convinced that--that this story is--is hiding the truth about ADM, that ADM, in fact, does have an under-the-table bonus plan, and that I'm--I'm just lying about it, and so, you know, the book is not without its critics.

But for the most part, what I have heard has been either people who are involved in it thanking me or saying how accurate it is, or people who knew nothing about it--those are actually my favorite reactions--people who knew nothing about it who always call--if-if they know me, they call me when they're on chapter 17, including my own mother, saying, `Is this really true?', because once you get to the level of--of The Lamet-Vov and--and abductions, and was there really an abduction? No, maybe there wasn't, and the Swiss bank accounts and the suicide attempts, I mean people begin to think that--that this can--this story could not have possibly happened.
LAMB: There's a lot of description in the book about so-and-so's driving down the road looking out the window, looks up at the clouds, at the puffy white clouds and all that, and--I'm exaggerating, but...
Mr. EICHENWALD: Yeah. I was going to say, I never did puffy white clouds.
LAMB: It's pretty close to that, though, as you know.
Mr. EICHENWALD: I think--I don't know how I'd figure out puffy white clouds.
LAMB: Here is a footnote I wanted to ask you about at the beginning of chapter four. `The description of the weather on the road from Decatur to Springfield comes from records on file with the National Climactic Data Center in Asheville, North Carolina. The records include the hourly surface weather observations for November 10th, 1992, from both the Decatur and Springfield stations maintained by the US Department of Commerce.' Did you go get those descriptions so that you could put them in the book?
Mr. EICHENWALD: I--I had a researcher who knows those people very well, and I would give him the dates and times...
LAMB: That's how you embellished on the...
Mr. EICHENWALD: ...that I would need.
LAMB: ...excuse that word.
Mr. EICHENWALD: Well, `embellish' is not the word.
LAMB: I know. I know. But that--but that's...
Mr. EICHENWALD: Well, no--let's--I mean, talking about that one scene what--what I do--did for that one scene that started off with-I forget the--the file number--but the particular FBI document that states the exact time that a tape recording was turned over...
LAMB: FD-504B?
Mr. EICHENWALD: FD-504B. That set the time of when this event took place. From other reporting, I knew that within a short time of that document being filled out, this individual drove from Decatur to Springfield on Interstate 72. So then I proceeded to go out and do that drive, reciting everything I saw as I went along, then called people to make sure nothing had changed over the years, because, remember, this is a different year than when I did the drive. Then I had the general background, and I knew the time, but was it raining? Was it--was it calm? Was it--you know, that--and I was kind of hoping it would be bad weather, because bad weather is easier to write about--and fortunately, it--it was. You know, I asked--I asked my researcher to--to--to find out--to get the records from Decatur and Springfield for this hour in this time frame, and the--and that is what you end up finding in the book.
LAMB: How much help did you have?
Mr. EICHENWALD: I had--I had three re--researchers who worked for me, one at a time. The deal I make with my researchers is, you know, you work for me and I sort of become your--your advocate for your job, and one of them I got hired away from myself, so--and ultimately two of them were hired into jobs, and the third has--had a job of her own.
LAMB: Why no index?
Mr. EICHENWALD: You know, that was a very debated thing, and ultimately the decision was made that this book was written to read like a novel. It's--it's a game on truth and fiction, you know. You never know where reality is until the whole book is over. If you put f--if you put in a--a--an index, and actually since it's has come out, I've reconsidered this, and I think it was--I--I think--I--I agreed with this. I--I was actually an advocate of it at the end, and I think it was the wrong call. You ultimately create a situation where people can jump around, and they can find, you know, pieces, and the pieces allow that--you know, you're brought into the middle of something which could be complete fiction, you're brought into the middle of something would could be totally true, and you have no idea, no way of knowing, that that's the case.

As I thought about it and went through it, novels don't have indexes, "A Civil Action" didn't have an index, and maybe that would be the--the last shred of--of doing it this way. But I--I--I--I think my--I think my call on that was wrong.
LAMB: Is there a movie here? Have you sold the rights?
Mr. EICHENWALD: We're about to sign a contract this week.
LAMB: You have any sense of how soon they would make a movie?
Mr. EICHENWALD: I--I sold my last book for a movie, and I'm still...
LAMB: What was that?
Mr. EICHENWALD: ...I'm still waiting for that one to come out.
LAMB: What--what was the last book?
Mr. EICHENWALD: That was called "Serpent on the Rock." It was about the--a s--the largest investment scandal in history.
LAMB: And where do you write this stuff?
Mr. EICHENWALD: Where?
LAMB: Where, physically.
Mr. EICHENWALD: Physically, I write it in my--well, both books were in different places--I wrote the first one in my very tiny off-the-living-room office. Then from the proceeds of my last book, I built a new office, and build in my--you know, off the basement. My kids are usually playing--I have a soundproof door, which is great--and it's a--I just sit there and type away.
LAMB: What do you write it on?
Mr. EICHENWALD: On a PC. Well, it's--and it's interesting, though, there's--there's a lot of different things I--I do, you know, the-I talked about--earlier about structuring the book, and that involved diagramming, and the diagrams start off being on a white board and eventually were--were put onto construction paper and I will hang documents up that I know I'm going to be coming to and I need to incorporate into the story. I had another white board that I would write factual questions on or issues on, things that I had to res--things that I wanted to get that I didn't have, because in the writing of it, you find, you know, they're eating a sandwich. Well, what kind of sandwich was it? You know, I got to go back and find that somehow.

There was a time--there was a meeting in here--there are two hotels that are right next to each other--the Forsyth Inn and the Hampton Inn--not the Forsyth Inn, the...
LAMB: In Decatur.
Mr. EICHENWALD: In D--yeah, just outside of Decatur, these two hotels that are virtually identical, and literally right next to each other, and everybody recalled this meeting as having taken place in one hotel, but I--I realized, wait, I think I have a record of that day, and went and spent, you know, over an hour digging through these receipts and documents and other pieces of information, and found a slip of paper that made reference to the actual location of this-of this event, and it was the other hotel. I was very happy that day, but I was like, `Nobody will ever know I got this right.'
LAMB: This time we are out of time, on part two, and this is "The Informant," the cover of the--the book, and our guest has been Kurt Eichenwald. Thank you very much.
Mr. EICHENWALD: Thanks for having me.


Copyright National Cable Satellite Corporation 2001. Personal, noncommercial use of this transcript is permitted. No commercial, political or other use may be made of this transcript without the express permission of National Cable Satellite Corporation.