USDA Settles a Packers and Stockyards Case Against Coleman Livestock Auction Commission Co., Inc.

Date: 
Wednesday, August 21, 2019 - 12:00pm
Contact Info: 

Release No.: 111-19

WASHINGTON, Aug. 21, 2019 – As part of its commitment to ensuring fair and competitive markets for the livestock, meat and poultry industries, on Aug. 6, 2019, the U.S. Department of Agriculture (USDA) entered into a stipulation agreement with Coleman Livestock Auction Commission Co., Inc. (Coleman Livestock) for alleged violations of the Packers and Stockyards (P&S) Act. Under the terms of the stipulation agreement, Coleman Livestock waived its right to a hearing and paid a penalty of $7,000.

An investigation by USDA’s Agricultural Marketing Service on Oct. 29, 2018, revealed Coleman Livestock failed to maintain its custodial account, resulting in custodial shortages of $539,324 on Aug. 31, 2018 and $66,771 on Sept. 30, 2018. The shortages were due to Coleman Livestock’s failure to reimburse the custodial account for receivables by the close of the seventh day following the sale and for owner, officer and employee purchases before the close of the next business day following the sale of livestock.

A custodial account is a trust account designated for shippers’ proceeds from the sale of livestock in trust for sellers. Operating with custodial account shortages is a violation of the P&S Act and places livestock sellers at risk of not being paid timely or at all.

The P&S Act authorizes the Secretary of Agriculture to assess civil penalties up to $28,061 per violation against any person after notice and opportunity for hearing on the record. USDA may offer alleged violators the option of waiving their right to a hearing and enter 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 Stuart Frank, Packers and Stockyards Division, at (515) 323-2586, or by email at stuart.frank@usda.gov.

Get the latest Agricultural Marketing Service news at www.ams.usda.gov/news or follow us on Twitter @USDA_AMS. You can also read about us on the USDA blog.

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