WASHINGTON, April 23, 2025 – The U.S. Department of Agriculture (USDA) entered into a stipulation agreement with Loy Brothers Livestock Market Inc dba Russell County Stockyards, of Russell Springs, Ky., on Feb. 6, 2025, resolving alleged violations of the Packers and Stockyards (P&S) Act. Under this agreement, Loy Brothers waived its rights to a hearing and agreed to pay a civil penalty of $8,500.
A USDA Agricultural Marketing Service investigation revealed that Loy Brothers had custodial account shortages of $595,862 on May 31, 2024, and $389,554 on June 30, 2024. The custodial account shortages were due to custodial account misuse and failing to reimburse the custodial account for uncollected receivables by the close of the seventh day following the livestock sale. The misuse consisted of Loy Brothers’ allowing unlawful withdrawals of bank fees and payments to a line of credit.
A custodial account is a trust account required for handling proceeds from the sale of livestock. The market agency maintains this account to benefit livestock sellers. Custodial misuse and failing to reimburse the custodial account on time are considered a violation of the P&S Act and its regulations.
The Secretary of Agriculture has authority under the P&S Act to act against violators, including issuing orders to cease and desist, suspending registrations, and applying other appropriate remedies as authorized by the Act. The USDA may also offer alleged violators the option to waive their right to a hearing and enter into a stipulation agreement to resolve the suspected violations quickly.
For information about the P&S Act, contact Amy Blechinger, Packers and Stockyards Division, at (202) 720-7051 or at Amy.R.Blechinger@usda.gov.
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