WASHINGTON – Congresswoman Rosa DeLauro of Connecticut again asked the US Department of Agriculture and the Office of the Inspector General to determine if JBS S.A. meets requirements to receive federal subsidies.
DeLauro called for an investigation of the meatpacker after its parent company, J&F Investimentos, pled guilty to violating the Foreign Corrupt Practices Act (FCPA) in October. The company agreed to pay $128.25 million in criminal fines, which is half of a $256.5 million fine levied by the Department of Justice, because of previous settlements the company made with Brazilian federal authorities.
J&F Investimentos, along with JBS, also agreed to pay nearly $27 million to resolve US Securities and Exchange Commission (SEC) charges that Joesley Batista and Wesley Batista engaged in a bribery scheme in part to facilitate JBS’s 2009 acquisition of Pilgrim’s Pride Corp.
According to the SEC, the Batistas, while serving as board members of Pilgrim’s, “...made payments of approximately $150 million in bribes at the direction of a former Brazil Finance Minister using in part funds from inter-company transfers, dividend payments, and other means obtained from JBS operating accounts containing funds from Pilgrim’s. As set forth in the order, the Batistas exerted significant control over Pilgrim’s, which shared office space, overlapping board members and executives, accounting and SAP systems, and certain internal accounting controls and policy documents with JBS and its US affiliate JBS USA.
“The order finds that as a result of that control, the Batistas caused the failure of Pilgrim’s to maintain an adequate system of internal accounting controls and accurate books and records,” the SEC said. “The order also finds that the Batistas, who signed Pilgrim’s Pride’s financial statements, did not disclose their conduct to Pilgrim’s Pride’s accountants and independent public accountants.”
In a letter, DeLauro urged Agriculture Secretary Sonny Perdue to initiate suspension and debarment proceedings against JBS USA and each of its companies, including but not limited to Pilgrim’s Pride.
“For several years, I have grown concerned about the continued and substantial payments to US subsidiaries of the corrupt Brazilian-owned and controlled meatpacker, JBS,” DeLauro wrote. “As part of USDA’s so-called ‘trade aid package,’ JBS has received more than $100 million dollars in payments – assistance that was supposed to have been for struggling farmers and ranchers who have been hurt by the Administration’s failed trade policies.
“But many fail to realize the full extent of the USDA subsidies JBS has received. Unlike farmers and ranchers, JBS also receives payments, as procurement contracts, on an annual basis through the USDA’s Agricultural Marketing Service,” DeLauro said in the letter. “In fact, US taxpayers have subsidized JBS with hundreds of millions of dollars over the past several years.”
In 2019, DeLauro requested a USDA investigation into JBS, however Perdue declined her request on the grounds that a USDA investigation would conflict with the DOJ and SEC probes that were underway at the time.