As part of a plea deal, Ohio Attorney General Mike DeWine’s office agreed to dismiss the remaining 35 charges against defendant Richard J. Schwan, 79, of 671 N. Ohio 99, Monroeville, provided he repays $3,222,209.70 prior to his sentencing hearing in August.
The money will be used to reimburse the farmers, the Ohio Department of Agriculture, and the Ohio Grain Indemnity Fund.
Christian Stickan, a senior assistant attorney general, was the special prosecutor in the case, which was investigated by the Ohio Department of Agriculture.
Schwan pleaded guilty to one count of attempted aggravated theft, two charges of aggravated theft and one count each of falsification in a theft offense, insolvent handler and delay price agreement.
Huron County Common Pleas Judge Jim Conway said the defendant faces up to 19 1/2 years in prison and fines totaling $52,500, but community control sanctions (aka probation) lasting up to five years with county jail-time could be a possibility.
Also, Conway said the state would dismiss the 35 charges against Schwan upon the receipt of slightly more than $3.2 million in restitution and an additional $105,358.50 to cover the cost of the investigation.
Schwan was doing business as Schwan Grain Inc. and registered with the state as a grain handler. Stickan said the defendant defrauded 35 farmers of property or services between June 2012 and Dec. 10, 2014 and promised to pay them back for grain, but didn’t do so. Also, the senior assistant attorney general said Schwan falsified a financial statement for the purpose of a theft while the insolvent handler felony covered a June 30, 2014 incident involving deposits when Schwan was a licensed handler.
When Schwan was arraigned in November, he said he had no prior felony convictions.
Two days earlier, the Huron County Sheriff’s Office arrested him and transported him to jail. Schwan later signed a personal recognizance (P.R.) bond, a court document in which he promised to appear for future hearings without paying any money. He then was released from custody.
After Monday’s plea hearing, Conway ordered a victim impact statement and for Schwan to cooperate with a pre-sentence investigation, information he will use for the Aug. 23 sentencing hearing.
In addition, the judge said Schwan could remain out on the property and P.R. bond involving 18 parcels, but amended it to allow a title company to start transferring the property. In November, Conway told Schwan that he and his wife Carolyn weren’t allowed to sell or transfer any of it while the case was pending.
"Ohio's farmers work hard to produce their crops, and this defendant callously took the profits of their labor," DeWine said. "Our priority in this case has always been to recover the money that rightfully belonged to these farmers, and a condition of this plea agreement requires the defendant to promptly repay the money he stole."
Schwan operated Schwan Grain Inc., which transported and sold grain on behalf of the 35 farmers from Erie, Huron, Lorain, Richland, and Seneca counties. He was arrested in November after an investigation by the Ohio Department of Agriculture found that between 2012 and 2014, he sold more than $3 million in grain for the farmers, but authorities said he deliberately failed to pay the victims their shares of the profits.
The investigation also found that Schwan filed several financial reports and other documents with the Ohio Department of Agriculture that falsely reported and concealed his liabilities and the money he owed the victims.
Of the more than $3.2 million dollars that Schwan must repay, about $2.5 million will be used to reimburse the Ohio Grain Indemnity Fund, which previously reimbursed the farmers for the majority of their losses. The fund, which is paid for by Ohio farmers through a half-cent per bushel fee, reimburses farmers when a grain handler becomes insolvent.
“All of Ohio’s grain farmers pay into the Grain Indemnity Fund and we’re pleased it will be reimbursed for their ultimate benefit,” said Ohio Department of Agriculture Director David Daniels. “We appreciate the work of all parties to resolve this matter, making sure Ohio farmers are protected for years to come.”
The remaining restitution will reimburse the balance of the funds still owed to the farmers and will pay for investigative costs incurred by the Ohio Department of Agriculture.
Farm equipment worth hundreds of thousands of dollars was also seized as part of the investigation.