(Jan. 30) NEW YORK — Reclamation is the newest theme emanating from the fallout of the Hunts Point bribery scandal of 1999.
Letters are pouring into the office of Agriculture Secretary Ann Veneman, urging the U.S. Department of Agriculture to rethink the penalties that prompted one company to shut its doors and may yet force closure of seven others.
It doesn’t appear, however, that USDA is going to back down.
The letters share a common theme: Any business that disappears will never pay its debts.
Jim Allen, president of the Fishers-based New York Apple Association, sent his own letter, pointing out that USDA sanctions leveled against firms that violated the Perishable Agricultural Commodities Act would punish the innocent more than the guilty.
“All we’re saying is that we encouraged them to work with the Hunts Point Marketing Association to work out an arrangement so that some of these companies can stay in business under certain circumstances, and that they make restitution,” he said, adding that he doesn’t support “a free ride” for anybody.
“I fully support equal justice for all,” he said.
“Both the USDA and the merchants have to be held to the highest standards. We depend on them to do their jobs.”
For one company, King Sol Produce Inc., which went out of business in 2001, any reprieve would come too late.
But, Allen said, those that have survived “need to be around to continue to do business and make restitution, pay penalties but stay in business.”
DEPENDING ON THE MARKET
Maureen Torrey, vice president of Torrey Farms Inc., Elba, and a member of the Fruit and Vegetable Industry Advisory Committee, said that more than 300 family farms depend on the Hunts Point market.
“There should be other means to arrive at a workable solution,” she said.
However, there are still 175 active PACA-licensed buyers operating in and around Hunts Point, said Eric Forman, associate deputy administrator for the fruit and vegetable programs in USDA’s Agricultural Marketing Service.
“The seven firms which may have their licenses revoked constitute 4% of the firms within this area,” he said.
“Given the large number of firms located with this … we do not believe that produce sellers accustomed to marketing their products in this area would incur long-term negative effects as a result of the license revocation of the remaining seven firms.”
Forman said that the USDA had taken into account the views expressed in the letters.
“We have also taken into consideration the seriousness of the PACA violations involved in the Hunts Point incident,” he said.
“The payment of bribes to a USDA inspector undermines the integrity of the entire inspection process and, indeed, the entire marketing system.”
That USDA inspectors were involved in wrongdoing, as well, makes no difference, Forman said, adding that the USDA, working with the FBI, uncovered the bribery scheme.
The rules, Forman said, already allow for several steps, including a hearing in front of an administrative law judge and an appeal process.
As of Jan. 29, the USDA had filed eight cases seeking a ruling of repeated and flagrant violations of PACA by nine companies implicated in the scandal.
Forman said that a default order was issued against King Sol Produce when it failed to file an answer to charges that it had violated PACA law.
An appeal was denied in a second action, against wholesaler Post & Taback, Forman said.
“The firm has filed with the judicial officer a petition for reconsideration of the decision,” he said.
Six other actions are pending. Hearings involving Coosemans Specialties, Koam Produce and Tombetta & Sons Inc. have been conducted.Hearings have been scheduled on the remaining cases, which include:
- BT Produce Co. Inc.
- Kleiman & Hochberg Inc.
- G&T Terminal Packaging Co.-Tray Wrap Inc.