USDA Restricts PACA Violators in California from Operating in the Produce Industry

Date: 
Friday, July 27, 2018 - 12:30pm
Contact Info: 

Release No.: 100-18

WASHINGTON, July 27, 2018 – The U.S. Department of Agriculture (USDA) has imposed sanctions on four produce businesses for failure to pay reparation awards issued under the Perishable Agricultural Commodities Act (PACA).

The following businesses and individuals are currently restricted from operating in the produce industry:

  • Amon Foods Inc., operating out of Hayward, Calif., for failing to pay an $8,670 award in favor of a California seller.  As of the issuance date of the reparation order, Hussein Tawfik was listed as the officer, director and major stockholder of the business.
  • JH Farm Inc., operating out of Los Angeles, Calif., for failing to pay a $20,846 award in favor of a California seller.  As of the issuance date of the reparation order, Jong Ho Lee was listed as the officer, director and major stockholder of the business.
  • Wasil Obaid, doing business as Frisco Wholesale, operating out of Oakland, Calif., for failing to pay a $32,294 award in favor of a California seller.  As of the issuance date of the reparation order, Wasil Obaid was listed as the sole proprietor of the business.
  • Sergio Garcia, doing business as Garcia Produce, operating out of San Bernardino, Calif., for failing to pay a $6,300 award in favor of a Florida seller.  As of the issuance date of the reparation order, Sergio Garcia was listed as the sole proprietor of the business.

PACA provides an administrative forum to handle disputes involving produce transactions; this may result in a reparation order being issued that requires damages to be paid by those not meeting their contractual obligations in buying and selling fresh and frozen fruits and vegetables.  USDA is required to suspend the license or impose sanctions on an unlicensed business that fails to pay PACA reparations awarded against it as well as impose restrictions against those principals determined to be responsibly connected to the business when the order is issued.  Those individuals, including sole proprietors, partners, members, managers, officers, directors or major stockholders, may not be employed by or affiliated with any PACA licensee without USDA approval.

The PACA Division, which is in the Fair Trade Practices Program in the Agricultural Marketing Service, regulates fair trading practices of produce businesses that are operating subject to PACA, including buyers, sellers, commission merchants, dealers and brokers within the fruit and vegetable industry.

In the past three years, USDA resolved approximately 3,400 PACA claims involving more than $58 million.  PACA staff also assisted more than 8,500 callers with issues valued at approximately $151 million.  These are just two examples of how USDA continues to support the fruit and vegetable industry.

For more information regarding this matter, contact John Koller, Chief, Dispute Resolution Branch, at (202) 720-2890, by fax at (202) 690-2815, or by email at PACAdispute@ams.usda.gov regarding this matter.

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