WASHINGTON – Officials from the Office of the Inspector General (OIG) of the US Dept. of Agriculture faced calls to investigate the department’s trade mitigation program and JBS S.A., a high-profile recipient of program payments.
The issue was the source of intense discussion during an OIG budget hearing before the House Subcommittee on Agricultural, Rural Development, Food and Drug Administration and Related Agencies. Inspector General Phyllis Fong said her office is reviewing how USDA designed and implemented the Market Facilitation Program, which assists farmers and ranchers directly impacted by the administration’s trade war with China. But she declined to confirm that OIG is investigating JBS USA, a subsidiary company. JBS currently is under investigation by the US Dept. of Justice and the Securities and Exchange Commission.
“This is because the Batista brothers, the leading shareholders, have admitted to numerous criminal acts consisting of the bribery of thousands of Brazilian government officials to obtain illicit loans from Brazil’s national bank,” said Rep. Rosa DeLauro (D-Conn.). “The ill-gotten loans were then used by JBS to illegally enter and consolidate the meat packing industry in the United States.
“You talk to cattle producers; you find out what they think about JBS; you’re not going to get a favorable answer,” she added.
DeLauro said she wrote to Agriculture Secretary Sonny Perdue requesting an investigation into JBS, but Perdue declined her request on the grounds that an USDA investigation would conflict with current investigations underway in DOJ and SEC.
“How seriously are you taking these allegations?” DeLauro asked.
“We are aware of these allegations as reported by you and the media,” Fong said. “We are doing what is appropriate at this time.”
Fong noted that OIG is required by law to coordinate with the DOJ but declined to confirm an OIG investigation into JBS S.A. or trade mitigation payments made to the company. Fong did say that several audit reviews related to the program are in the works.
“The first piece of our audit in this area, the first audit results, will be coming out in the next few months,” she said.
An analysis by the Midwest Center for Investigative Reporting showed had received 26 percent of $300 million from the Market Facilitation Program, which assists farmers and ranchers directly impacted by the administration’s trade war with China.
“We operate US pork plants, processing American hogs raised by US farmers — the true program beneficiaries,” company spokesperson said in May of 2019. “Like other companies in the program, our sole intent for participating is to support US producer prices and help our American producer partners. This is not a bailout. We are paid for the work of our team members in the plant and the products we produce, which are used to support important federal feeding programs that assist US citizens.”
USDA announced the third tranche of payments under the program on Feb. 3.