Public Statements & Remarks

Statement of Commissioner Kristin N. Johnson Regarding Settlement with Cody Easterday for Massive Fraud, False Statements to an Exchange, and Position Limits Violations

June 05, 2023

Today, the U.S. District Court for the Eastern District of Washington issued an order granting a permanent injunction to resolve pending litigation against Cody Easterday (Consent Order).  Easterday had previously been charged by the Commission for engaging in fraud in connection with the sale of more than 200,000 head of “ghost” cattle—which did not, in fact, exist—to Tyson Fresh Meats, Inc. (Tyson), a beef processor and part of a corporate family that together constitute one of the largest food suppliers in the world, as well as with making false statements to the Chicago Mercantile Exchange (CME) and violating exchange-set position limits.[1]  As a result of Easterday’s fraud, Tyson paid him and his feedyard, Easterday Ranches, Inc. (Easterday Ranches), more than $233 million to which they were not entitled.[2]

Easterday’s fraud arose out of his need to cover for losses of more than $200 million he incurred over a ten-year period through speculative trading in the cattle futures markets.[3]  In order to cover margin calls, he devised a scheme to cause Easterday Ranches to submit false invoices to Tyson for reimbursement of the costs associated with procuring the “ghost” cattle he never actually purchased and caring for “ghost” cattle that did not actually exist.[4]  At the same time, in connection with his speculative futures trading, he made false statements to the CME that Easterday Ranches had a larger cattle inventory than it in fact had to obtain a hedge exemption for permission to exceed its speculative position limits that would otherwise have applied, and to avoid disciplinary action; because these statements were false, Easterday also caused Easterday Ranches to violate CME’s position limits without a valid hedge exemption.[5]

Easterday Ranches filed a Chapter 11 bankruptcy petition in February 2021, and subsequently settled the Commission’s litigation against it, including imposition of a restitution obligation of $233 million and a civil monetary penalty of $30 million.[6]  Approximately 18 months after the CFTC filed its civil action, Easterday entered a guilty plea to one count of wire fraud arising from the same conduct, for which he was sentenced to 132 months in prison and restitution of $244 million.[7]  Easterday has now resolved the Commission’s litigation against him with the entry of this Consent Order.  The Consent Order includes an injunction against future violations, trading and registration bans, and a civil monetary penalty of $1 million.

I support this settlement because it appropriately penalizes Easterday for his conduct, while recognizing the already significant consequences imposed against him as a result of the criminal action and the bankruptcy of Easterday Ranches (which ultimately returned approximately $65 million to victims of his scheme).  I particularly note that the settlement bars Easterday from future violations of the Commodity Exchange Act and Commission regulations, and also from trading in commodity interests or applying for registration with the Commission.

I commend efforts of the staff of the CFTC’s Division of Enforcement who pursued this litigation, including Benjamin E. Sedrish, Joseph Patrick, Ashley J. Burden, Allison V. Passman, Margaret Aisenbrey, William Janulis, Scott Williamson, and Robert T. Howell.

[1] See CFTC Release No. 8372-21, CFTC Charges Washington State Rancher and Feedyard with $233 Million Phantom Cattle Fraud Scheme, Mar. 31, 2021,

[2] Consent Order ¶ 22.

[3] Compl. ¶ 23, CFTC v. Easterday, No. 4:21-cv-5050 (E.D. Wash. Filed Mar. 31, 2021), ECF No. 1.

[4] Consent Order ¶¶ 20–21.

[5] Id. ¶¶ 23–24.

[6] CFTC Release No. 8471-21, Federal Court Orders Washington State Feedyard to Pay $263 Million for Phantom Cattle Fraud Scheme and Violating Position Limits, Dec. 17, 2021,

[7] U.S. Atty’s Office, E.D. Wash., Tri-Cities Rancher Sentenced to Eleven Years in Federal Prison and Ordered to Pay $244 Million in Restitution for “Ghost Cattle” Fraud, Oct. 4, 2022,