R-CALF USA calls for corruption probe of Greeley-based JBS | MyWindsorNow.com

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R-CALF USA calls for corruption probe of Greeley-based JBS

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While JBS S.A. officials are embroiled in political and criminal turmoil in South America, the global meat processing conglomerate's American subsidiary, Greeley-based JBS USA, may see some of the fallout of the months-long corruption scandal that has resulted in $3 billion in fines for its parent company.

Montana-based R-CALF USA has requested a full investigation and strict antitrust enforcement action against JBS USA. In an 11-page letter to President Trump, Senate Judiciary Committee Chairman Charles Grassley, Attorney General Jeff Sessions and Agriculture Secretary Sonny Perdue, the group states it was as likely as not that JBS deployed that same corrupt business model in the U.S. as what its parent company is now being punished for in Brazil.

"A full and complete investigation is needed to determine the full scope of JBS's potentially unlawful activities in the United States and the impact that any such unlawful activities have had on the single largest segment of American agriculture — the U.S. live cattle industry," the group wrote in a news release.

JBS officials did not return a request for comment Friday for this story, but Steve Kay, publisher of Cattle Buyer's Weekly in California, an independent industry publication, said the group would likely be ignored. He said the group doesn't have the kind of pull it once did to in Washington. He described the organization as "opportunistic" and depicting JBS as using "graft and bribery" to enter the U.S. market as "its usual rhetoric."

"It's hard to imagine R-CALF's comments and requests getting any traction," he said.

To hold JBS USA up as complicit in the South American scandal, and alleging they were duplicating such tactics in the United States, was simply wrong, Kay said.

"They're subject to the same reporting requirements, restrictions and everything else from meat inspections to prompt payment under jurisdiction of Packers and Stockyard Act and so on and so on," Kay said. "It is ludicrous to suggest that JBS does not conduct its affairs in the United States just like any other company operating here."

The group, which states it represents thousands of U.S. cattle and sheep producers on domestic and international trade and marketing issues, called JBS a powerful influence on Capitol Hill and alleged that U.S. officials helped JBS build a monopolistic, American empire in the U.S. protein market with the company's "ill-gotten gains."

A phone call to the organization was not returned Friday.

Meanwhile, JBS SA is selling off assets at three meat processing plants to a rival Brazilian meat processor for $300 million. The deal is expected to close next month. Despite plea bargains with JBS executives, there's no date in sight for any closure on the corruption scandal.

J&F Investimentos, JBS SA's parent company, settled with federal prosecutors and agreed to pay a $3.1 billion fine for its role in the scandal that has been making headlines for months and has President Michel Temer's political future in jeopardy because of his involvement.

Former JBS chairman and J&F owner, Joesley Batista, in a plea bargain, gave authorities a secretly taped conversation with President Temer, allegedly discussing hush money. But, despite Batista's plea bargain and court agreement, a federal court issued an injunction to freeze $246 million in his bank accounts.

CEO Wesley Batista, Joesley's brother, has stayed on at JBS in São Paulo, according to the latest reports.

Along with the fines, the company is facing insider trading investigations, and its stock is down by almost 33 percent this year. Plus, Domino's Pizza Brazil has taken a stance against the corruption, refusing to buy products from JBS. A spokeswoman for the Brazil franchise told reporters that this applies to 184 restaurants.

Domino's Pizza Brazil said in a statement it "will do the same with any other company that goes against its values of ethics and transparency." It added the process of approving other products from JBS's portfolio was also halted, in a decision made exclusively by the Brazilian network of Domino's Pizza.

Kay, of Cattle Buyer's Weekly, said JBS USA will likely remain strong in its worldwide holdings, and that the scandal in South America will likely remain isolated. "The direct fallout is pretty much going to be confined to Brazil," Kay said. "JBS to our knowledge is not engaging in any of those behaviors outside of Brazil."

He said JBS has made it clear it does not plan to sell its core assets, such as its headquarters and packing plant in Greeley, and its U.S. chicken operations through Pilgrim's Pride.

— Freelance reporter Traci Eatherton contributed to this report.