A massive Brazilian meatpacking company is raking in millions of U.S. taxpayer dollars even while two federal agencies are investigating the corruption-addled parent company of the meatpacker.
In January, the Department of Agriculture purchased $22.3 million worth of pork from JBS USA, a subsidiary of the Brazil-based company JBS SA. But the one hand doesn’t seem to know what the other is doing. While USDA is contracting with JBS, the Justice Department and the Securities Exchange Commission are investigating the parent company, J&F Investimentos, for “potential violations of the Foreign Corrupt Practices Act,” according to D.C. court documents reviewed by the Washington Examiner from September 2018.
A USDA spokesperson defended the agency’s contract with JBS in a prepared statement sent to the Washington Examiner. “USDA buys American commodities, produced on American farms by American farmers. [USDA’s Agriculture Marketing Service] obtains and maintains approved vendors who have proven they can procure these U.S.-produced products. This means that regardless of who the vendor is, the products purchased are grown in the U.S. and benefit U.S. farmers. JBS qualifies as a bidder under this criteria. This is similar to someone buying JBS bacon in a grocery store. Regardless of the packaging, the bacon inside is from a hog grown on an American farm.”
The DOJ and SEC declined to comment.
The current trade war with China, which is hurting U.S. farmers, has resulted in even more taxpayer money flowing to JBS. The company has pocketed more than $64 million in federal payments through Trump’s special trade-war bailout program for farmers.
JBS SA is the largest meat processing company in the world. According to its 2018 earnings, it has a net income of $45 billion. J&F Investimentos is wholly owned by Joesley and Wesley Batista, billionaire brothers who confessed to and served prison time for bribing hundreds of officials in the Brazilian government.
The Batista brothers’ complex and ongoing court case in Brazil took a strange turn this past week after Wesley Batista was indicted by a Brazilian federal court for insider trading. If convicted, he could serve a prison sentence of one to five years and a hefty fine.
On top of the DOJ and SEC investigations, the Batista brothers are also closely connected to Diosdado Cabello, the president of the Nicolás Maduro-backed Venezuelan National Assembly, through a $2.1 billion meat and poultry contract in 2015. In 2017, it was reported that Cabello put out an assassination order against Sen. Marco Rubio, R-Fla., according to U.S. intelligence. Rubio’s office has not yet responded to a request for comment.
The U.S. cattle industry has long battled with JBS, which it accuses of illegally colluding with other meat packers to drive down prices. The ranchers point to the many investigations swirling around the Brazilian company. In June 2017, Ranchers-Cattlemen Action Legal Fund United Stockgrowers of America, the largest cattle association in the country, called on the Trump administration to move forward on an antitrust investigation into the company, citing its corrupt practices and its negative impact on farmers.
On Tuesday, Sen. Richard Blumenthal, D-Conn., sent a letter to Secretary of Agriculture Sonny Perdue urging him “to immediately cease any existing or future bailout payments to foreign-owned corporations, like the Brazilian-owned meatpacker JBS, and remove them from your approved and eligible vendors list.”
Blumenthal’s office did not respond to a request for comment.
