Man indicted in federal court for $1.2 million farm equipment scam

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ST. GEORGE — An indictment filed in U.S. District Court in St. George alleges a Sanpete County farm equipment company owner bilked more than 20 individuals out of more than $1.2 million after devising a series of fraudulent schemes that left at least one financial institution over $50,000 poorer.

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Ryan Palmer, of Sterling, a town of roughly 320 residents that is located 73 miles south of Provo, has been indicted on three charges, including bank fraud, wire fraud and money laundering, according to the indictment filed by Assistant U.S. Attorney Jay Winward in St. George that was unsealed on Wednesday.

The federal charges were filed following an investigation into the farm equipment company, Palmer Equipment LLC, owned and operated by the defendant.

According to federal prosecutors, the illegal activity reportedly began in 2017, when the defendant began devising schemes to obtain money and property under false pretenses, including one such scheme in which Palmer told several individuals he could sell their equipment on consignment. The defendant also presented himself as a farm equipment broker, telling potential buyers he could obtain farm equipment on their behalf.

Palmer also told several buyers that he could purchase and deliver functioning farm equipment that he owned free and clear. He also told a number of banks that he owned the equipment that was actually on consignment, and sold equipment he did not lawfully own.

Among other things, the indictment alleges that Palmer delivered defective equipment to a number of buyers and altered or removed serial numbers and placards from the equipment before selling it.

In other instances, Palmer failed to deliver the equipment to the buyers as promised, and failed to pay the owners, or made only partial payments from the proceeds when their equipment was sold.

The defendant entered into agreements with the equipment owners that included stipulations that prohibited the equipment from being sold for less than the agreed-upon price.

Court records outline an incident that took place on Oct. 5, 2018, when Palmer received a 1985 Allis-Chalmers 8050 tractor to sell on consignment.

According to the agreement between Palmer and the owner, the tractor, with an estimated value of $25,000, was to be sold for no less than $20,000.

Two months later, Palmer and his wife applied for a loan on and used seven pieces of equipment as collateral to secure the loan, including the Allis-Chalmers tractor, which the defendant said he owned.

On Dec. 18, 2018, the couple received the $51,000 loan that was deposited into their personal checking account at a local credit union and from there, the funds were disbursed between several accounts.

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Palmer never paid the bank back for the loan, and also sold some of the equipment that was held as collateral for the loan.

At the end of December, less than two weeks after the loan was issued,  the defendant sold the tractor and another piece of equipment for $19,450 and reportedly kept the funds without paying the owner from the proceeds of the sale.

In all, the defendant defrauded 25 victims out of more than $1.2 million, including the consignor of the Allis-Chalmers tractor.

The charge of bank fraud was filed based on evidence that alleges the defendant entered into consignment agreements with the sellers and then used that equipment as collateral to secure bank loans, then selling the equipment without paying the owners from the proceeds of the sales.

The indictment said Palmer also misrepresented material facts to defraud both the buyers and sellers to further the scheme.

The wire fraud charge was based on allegations that Palmer transferred the loan amount of $19,450 into a second credit union account in January 2019.

The money laundering charge relates to the bank transactions, including the transfer of $25,000 of the $51,000 loan that was transferred to a different account at another bank, as well as the $16,000 transfer of funds collected from the $19,450 sale of the tractor. Both were bank transactions resulting from fraud.

The indictment was also seeking forfeiture of any and all property derived from the scheme. Palmer is not in custody. He is scheduled to make an initial appearance in U.S. District Court in St. George on Jan. 11 before Magistrate Judge Paul Kohler.

Copyright St. George News, SaintGeorgeUtah.com LLC, 2022, all rights reserved.

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