The Informant

by Kurt Eichenwald

They walked out, with Herndon making a quick left into the conference room where some agents were still waiting. Shepard headed to the radio room with a message to be announced over the intercom.

  A minute later, the intercom crackled to life.

  “In the Harvest King matter,’’ a voice said, “it’s a go.’’

  Two hours later, Shepard and Herndon were silently sitting in a Bureau-issued car in front of a Decatur convenience store. A cell phone plugged into the car lighter rang, and Herndon answered.

  “Hey, it’s Mark. I think Mick’s on his way.’’

  “Thanks.’’

  A minute later, Andreas’s Mercedes drove past.

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  “There he is,’’ Shepard said.

  They waited. They didn’t want to confront Andreas in his driveway; they wanted him to get home, loosen his tie, talk to his family. His defenses would be down. He would be vulnerable.

  About ten minutes later, Herndon breathed in deep.

  “I think this is a good time to go,’’ he said.

  Shepard turned the key in the ignition. “That’s what I was thinking, too, Bob.’’

  Shepard pulled into the street. Herndon rubbed his palms; they were sweaty from nerves. In a short time, they were on North Country Club Road, headed to Andreas’s house. Shepard saw the driveway and put on his signal.

  Herndon picked up the car microphone. “Eight-oh-seven, this is SI-15,’’ he said.

  “SI-15, go ahead.’’

  “We’re going into subject number one’s house right now.’’

  Shepard pulled around the circular driveway and stopped. He paused for a second.

  “This is it,’’ Herndon said.

  In silence the agents headed to the door and rang the bell. Sally Andreas, Mick’s wife, answered.

  “Good evening, ma’am,’’ Shepard said. “I’m Special Agent Brian Shepard of the FBI. This is Special Agent Bob Herndon. Is your husband available?’’

  “Oh, yes. Won’t you come in?’’

  The agents stepped into the front hallway while Sally Andreas found her husband. When Mick appeared, his tie, coat, and shoes were already memories.

  “Hey, fellas, how’re you doing?’’ Andreas said in a low, rumbling voice. “What can I do for you? Always interested in helping law enforcement.’’

  “Well, we just want to take a minute of your time,’’ Shepard said.

  “We have something very serious we want to discuss with you.’’

  Andreas almost shrugged. “Well, sure,’’ he said. “Why don’t you follow me?’’

  The agents walked behind Andreas as he led them through the house. On the way, they passed a den. A boy, one of Andreas’s children, was watching television. Andreas brought the agents into his office and sat at his desk. The agents took chairs in front of the desk and showed Andreas their credentials.

  “Okay,’’ Andreas said. “So tell me about this serious matter.’’

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  Shepard took a breath. “You’re the first person we’ve contacted. We’re doing this because we respect your position; we understand your authority at the company. We’d like for you to listen to us for a little bit and hear what you have to say.’’

  Andreas didn’t move. “I’m all ears,’’ he said.

  “This involves an international investigation regarding price-fixing by many companies, including ADM,’’ Shepard said. “We’ve used numerous investigative techniques during the course of this, some that include our latest technology. In fact, we’ve gathered more evidence than we ever thought we could. It’s been a real learning experience for us.’’

  Shepard turned to Herndon. “Special Agent Herndon is going to give you a sample of what we learned.”

  “We won’t take much time; we’re going to get to the punch, Mr. Andreas,’’ Herndon said. “But we just want to give you the benefit of what we believe we know and see what your reaction is. And we’re going to have to ask you for your help in the end.’’

  Herndon ticked off a few facts. Trade associations as cover. The exchange of sales and production numbers. Audits to prevent cheating. He included a few facts that seemed to indicate that the case involved high-fructose corn syrup and citric acid. He never mentioned lysine. The agents were dedicated to protecting Whitacre as long as possible.

  Andreas listened calmly, his hands clasped on the desk. He struck Herndon as an amazingly cool customer.

  “We know a lot,’’ Herndon said, “because we’ve seen it and we’ve heard it. We even have tapes.’’

  Herndon lifted his soft briefcase off the ground. Opening the flap, he pulled out a tape recorder. For days, the agents had debated which tape to play at this moment. In the end, their hopes of keeping Whitacre’s role a secret had driven the decision. They chose a recording of an Andreas meeting with Yamada on April 30, 1993. Whitacre’s voice was not on the tape, and there were no direct references to pricefixing. If they were going to protect Whitacre, it was the best they could do. They hoped that Andreas would be frightened just hearing his voice on tape.

  Andreas listened to the snippet and shrugged. “Doesn’t sound like price-fixing to me,’’ he said.

  “We have other evidence, Mr. Andreas, other tapes,’’ Herndon said. “We have a lot of tapes.’’

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  Herndon paused, feeling the weight of a great silence in the room. For a moment, he wondered whether Andreas was somehow recording this.

  “Let me ask you a question, sir,’’ Herndon said. “Have you ever heard the statement, ‘The competitors are our friends and the customers are our enemies?’ ”

  “Are you aware of our second motto at ADM?’’ Andreas asked. “It’s

  ‘We know when we’re lying.’ ”

  The agents didn’t respond.

  “You know,’’ Andreas said, “I don’t think you guys understand the business.’’

  “Let me tell you why we’re here,’’ Shepard said. “This is probably the most impressive antitrust case in history. We’ve been speaking with the attorneys from the Justice Department’s Antitrust Division, and I think you can expect jail time for people who participated in these schemes, including you.’’

  Despite the many companies involved in the conspiracy, only ADM clearly fell within the easy reach of American law enforcement.

  “Right now, ADM stands alone,’’ Shepard said. “If you don’t cooperate, the other companies will prosper or could prosper. Customers are going to continue to need high-fructose corn syrup or citric acid, and they may be forced to buy from other companies. The other companies won’t have the black eye that ADM has.’’

  Still no mention of lysine. Andreas would probably never think of Whitacre.

  “You have an opportunity tonight to make a decision, and this decision is going to affect your life and your company. You have a chance to protect ADM and to influence the rest of the investigation. But you’ve got to make the decision tonight.’’

  Shepard paused. Andreas didn’t move.

  “Here’s the decision,’’ Shepard said. “Your dad has worked long and hard to make this company. You know that, we know it, and we’ve got a lot of respect for your dad and you. But we need your help.’’

  “I’m a law-abiding citizen,’’ Andreas responded. “I always try to cooperate with law enforcement. But I can’t make a decision to fully cooperate without consulting my dad and my attorney. ADM is publicly owned. I have a responsibility to the directors.’’

  “Mr. Andreas, we believe you have the authority to make the decision to cooperate,’’ Shepard replied. “We need your help gathering further evidence of price-fixing in citric acid, in high-fructose corn syrup, Eich_
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  or in any other product where price-fixing is going on right now. If you decide to help us, we want to start making phone calls tonight. We know it won’t be easy; it’s a big decision. But we’re telling you, if you don’t cooperate, ADM will stand alone domestically.”

  Andreas said nothing.

  “We think the decision is clear,’’ Shepard continued. “To keep ADM from being singled out, to save everything your dad has worked so hard for, you should help us. This is a onetime opportunity for you to help us gather evidence on other companies.’’

  Shepard stopped. That was the pitch.

  “Honestly, guys, I don’t think you understand the business,’’

  Andreas said.

  Andreas denied that there could ever be price-fixing at his company. The products the agents had mentioned were commodities, he said, and it was impossible to rig those prices. He admitted talking with competitors; of course it happened all the time. It was like having two used-car salesmen with lots next to each other, he said. They’re going to talk about how many cars they’re going to sell this year.

  “I know what an antitrust violation is,’’ he said. “And I haven’t broken any laws. What you’ve got on that tape is not an antitrust violation.’’

  “Again, we have a lot more evidence than just this,’’ Herndon said. “The tape was designed to show you that we have you on tape. It wasn’t to convince you that this is a violation right here.’’

  Herndon stared Andreas in the eyes. “You’ve got a decision to make,’’ he said. “We’re not going to stay here all night. You need to make a decision.’’

  “I’m not going to do it,’’ Andreas said abruptly. “I’m not going to be a spy. I’m not going to wear a wire, and my kid’s not going to wear a wire.’’

  Andreas sat back. “You guys need to leave. And the very first thing I’m going to do is call my dad and call the company attorneys.’’

  “Well, that’s fine,’’ Herndon said as he reached into his briefcase.

  “Before we leave, though, we need to serve you with some subpoenas.’’

  Herndon handed four subpoenas to Andreas, one for him and three for the company. Andreas set the documents down on his desk and stood.

  “Well, fellows, I think it’s time for you to leave,’’ he said again. Andreas walked to the office door. He stopped as he passed Shepard, a look of recognition in his eye.

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  “You owe me one,’’ he said to Shepard.

  “What do you mean?’’ Shepard asked.

  “I recognize you,’’ Andreas said. “We talked about another matter about two years ago.’’

  The Fujiwara incident. Shepard didn’t reply.

  More than thirty minutes after the agents had arrived, Andreas showed them out. They climbed back into their car, and as Shepard turned the ignition key, Herndon picked up the radio microphone.

  “Eight-oh-seven, this is SI-15,’’ he said.

  “SI-15, go ahead.’’

  “Eight-oh-seven, please advise all other units to proceed with the other investigation.’’

  The radio operator understood the meaning: Mick Andreas hadn’t flipped. The word went out to agents around the country just before six o’clock.

  The raids were on.

  Minutes later, Shepard and Herndon pulled into a sandy area just off the road, parking in front of a waiting car. Kevin Corr, the principal legal advisor in Springfield, came out of the other car and walked over as Herndon rolled down his window.

  “Well, you were gone so long I thought maybe you had him,’’ Corr said.

  “Nah, he’s not cooperating,’’ Herndon said. “So let’s go do the next thing.’’

  Corr nodded and walked back to his car. It was time to go confront Wilson.

  At almost the same instant, FBI agents walked into the main headquarters of ADM brandishing search warrants and headed quickly up to the executive floors.

  Allen Andreas, Mick’s cousin who years before had worked with ADM in London, was at his new desk at headquarters. He watched as a group of agents swept across the office, packing documents and carrying them out. None of them was paying attention to Allen. After a while, Allen decided this was a sign that the workday was over. He walked to the elevator.

  The warm, breezy evening had attracted a crowd to the outdoor patio at the Country Club of Decatur. At one table was Jim Shafter, the Eich_0767903277_5p_02_r1.qxd 10/11/01 3:57 PM Page 306 306

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  lawyer for the Andreas family who had attended Mick’s original FBI interview about the Fujiwara incident. He and his wife, Gigi, were relaxing over wine as they waited for their meal. Just past six o’clock, two cars pulled up in the parking lot about twenty yards away. With his back to the lot, Shafter couldn’t see Shepard, Herndon, and Corr as they walked from their cars into the club. Nor did he notice when Corr returned minutes later, escorting Whitacre to one of the cars.

  A waitress set dinner in front of the Shafters. As the couple enjoyed their meal, Shepard and Herndon came out of the club. Almost on cue, Whitacre climbed out of the car and approached the two agents, appearing apprehensive. Whitacre and one of the agents said something as they passed.

  Sometime later, the waitress returned to the table. “Mr. Shafter, when you finish with dinner, Mr. Reising would like to speak with you,’’ she said.

  “All right,’’ Shafter replied. “Thank you.’’

  Shafter thought nothing of the call. Probably ADM’s general counsel wanted to line up a golf game. But soon, the waitress returned.

  “Mr. Shafter, Mr. Reising would like you to call as soon as you can,’’ she said.

  “Okay, thanks.’’

  Minutes passed. The waitress returned.

  “Mr. Shafter,’’ she said, “Mr. Reising wants you to call him right now.’’

  Shafter considered using his cell phone. But if Reising had called three times, this was probably sensitive. He wiped his mouth with a napkin and stood.

  “I’ll be right back,’’ he said to his wife.

  Shafter walked inside the club to the men’s locker room and found a phone. Reising’s wife answered at his home. Her husband was at Mick’s, she said, and was expecting Shafter to call him there. Shafter dialed Andreas’s house, and Reising answered.

  “Come over here right now,’’ Reising said cryptically as soon as Shafter spoke.

  “Well, Rick, give me some heads-up here,’’ Shafter said. “What’s—”

  “Come over here right now,’’ Reising interrupted.

  Then he hung up.

  After pulling away from the country club, Shepard drove to a small marina. He and Herndon had not yet had a chance to take a breath, to Eich_0767903277_5p_02_r1.qxd 10/11/01 3:57 PM Page 307

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  talk about their interviews. Neither wanted to be immediately thrown into the mix at the Decatur R.A.

  Shepard pulled into a spot and shut off the car. He looked over at Herndon.

  “Do you think it went well?’’ Shepard said.

  “Yeah,’’ Herndon said. “I don’t think I would change a thing.’’

  Neither could believe Andreas had given them so much time; they had obtained some good statements. Wilson was even better—he repeatedly contradicted his words on tape. A jury would see that. The agents looked at each other and extended their hands.

  “Good job,’’ Shepard said.

  At that moment, agents were fanning out across Decatur, confronting ADM executives at their homes.

  Two older agents, Alec Wade and Steven Nash, pulled up in a Bureau car to the gate at the end of Dwayne Andreas’s driveway. They phoned the house from the car, and the gates swung open. Andreas met the agents inside. They told him that
they were investigating possible price-fixing in high-fructose corn syrup, citric acid, and lysine. They asked if he had ever heard about the trade associations that existed for those products.

  “I’m unfamiliar with those associations,’’ Andreas shrugged. “I consider most trade associations as do-gooders anyway.’’

  “Well, do you know if ADM sells any of these products to the government?’’ one of the agents asked.

  “No, I don’t. Do you?’’

  “No, sir, I don’t.’’

  The agents asked Andreas several questions about price-fixing, and he shook his head dismissively. It was impossible to fix prices in those products because too many variables were involved, he replied.

  The agents circled around, asking about Andreas’s contact with competitors and whether he was aware of any recordings of competitors that took place at the Decatur Club—a charge Whitacre had raised years before. Andreas calmly batted away each question.

  “Well, sir,’’ one of the agents said, “can you explain why Wayne Brasser was fired?’’

  Andreas looked back blankly. “Wayne Brasser? Who’s Wayne Brasser? Was he an employee?’’

  “Yes, sir. And we’ve heard Wayne Brasser was fired from ADM because he wouldn’t fix prices.’’

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  Andreas snorted a laugh.

  “Fat chance,’’ he grunted.

  In another part of town, Barrie Cox, the head of ADM’s citric business, had been surprised outside of his home by two FBI agents. The agents told him they were investigating possible price-fixing, and Cox goodnaturedly invited them inside. Everyone was taking a seat in the living room when the telephone rang. Cox took the call. When he returned, his smile was gone.

  “I don’t understand your inquiry,’’ Cox said suddenly. “And if you have any questions, I think you should call my boss, Terry Wilson, or the ADM corporate counsel, Richard Reising. Other than that, I don’t have anything to say.’’

  The agents stood to leave, and one of them handed Cox a grand jury subpoena. ADM was already locking up its employees, less than an hour after the operation began. Their lawyers moved fast. Howard Buffett was at home, playing host to Special Agent Robert Schuler. Not only was Buffett willing to talk, he was dropping tantalizing tidbits.