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Ex-Humboldt Creamery chief gets prison for fraud

AP newswire Published on 25 May 2011

A federal judge has sentenced Humboldt Creamery's former chief executive to 2.5 years in prison after he admitted covering up severe financial problems that bankrupted the business. The judge also ordered 50-year-old Rich Ghilarducci to pay a $7 million fine.

Ghilarducci pleaded guilty last year to a single count of loan fraud. He admitted falsely inflating the creamery's revenues between 2005 and 2008 to prevent a lender from learning of the creamery's true financial picture. The U.S. Attorney's Office says Ghilarducci ultimately defaulted on the loan, prompting the creamery to file for bankruptcy.

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Founded in 1927, Humboldt Creamery was mostly owned by a cooperative of local dairy farmers who lost their investments when the fraud was discovered.

The creamery has since been sold to Foster Farms Dairy at auction. PD

—From AP newswire

Related from 2010: Former Humboldt Creamery CEO pleads not guilty

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