USDA Settles a Case with The St. Joseph Stockyards Inc. Resulting in a $5,000 Penalty

Date
Friday, May 4, 2018 - 10:30am

Release No.: 045-18

WASHINGTON, May 4, 2018 – On Dec. 8, 2017, The St. Joseph Stockyards Inc. (St. Joseph), St. Joseph, Mo., waived its right to a hearing, entered into a stipulation agreement with the U.S. Department of Agriculture (USDA), and paid a penalty of $5,000 for alleged violations of the Packers and Stockyards (P&S) Act.

The USDA Agricultural Marketing Service’s (AMS) investigation of St. Joseph revealed custodial account shortages on Dec. 31, 2016, of $102,245.36; Feb. 28, 2017, of $144,013.93; and June 30, 2017, of $6,112.45.  A custodial account is a trust account that is a separate bank account designated for shippers’ proceeds.  Operating with custodial account shortages is a violation of Section 312(a) of the P&S Act, and places livestock sellers at risk of not being paid timely or at all.

The P&S Act, 1921, (7 U.S.C. § 181, et seq.) authorizes the Secretary of Agriculture to assess civil penalties of not more than $11,000 per count against any person who violates the statute(s) cited above, after notice and opportunity for hearing on the record.  In addition to the $5,000 penalty, the stipulation agreement requires St. Joseph to file monthly custodial account reports for six consecutive months with AMS, placing St. Joseph under close monitoring by AMS during that time.

USDA enforcement rules provide a mechanism to quickly resolve violations of the P&S Act.  USDA may offer alleged violators the option of waiving their right to a hearing and entering into a stipulation agreement to quickly resolve alleged violations.

The P&S Act is a fair trade practice and payment protection law that promotes fair and competitive marketing environments for the livestock, meat and poultry industries.

For further information about the Packers and Stockyards Act, contact Brett Offutt, Fair Trade Practices Program, Packers and Stockyards Division, at (202) 720-7051, or by email at s.brett.offutt@ams.usda.gov.

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