Posted on Wednesday, December 17, 2008
Food broker accuses California company of racketeering
By Denny Walsh | Sacramento Bee
Randall Lee Rahal, a New Jersey sales broker, leveled a startling allegation with a guilty plea in Sacramento federal court Tuesday, telling the judge that SK Foods L.P., one of the nation's largest processors of tomato-based products, has been run as a "racketeering enterprise" since 2004.
Rahal admitted that he used SK money to bribe purchasing managers whose list of employers reads like a who's who of food industry giants. In return, he related, the managers bought SK products at inflated prices and supplied SK with competitors' bidding and proprietary information.
He also admitted conspiring with SK to defraud some of its customers by supplying inferior and mislabeled products.
The charges against Rahal are the first to emerge from a nationwide probe of food pricing by federal prosecutors, FBI and IRS agents, and antitrust investigators. The inquiry was sparked by reports of collusion among farmers, processors and retailers that may be helping drive the price of groceries to all-time highs.
Read the complete story at sacbee.com
http://www.sacbee.com/topstories/story/1479305.html
Rahal, a former member of SK's board of directors, said Tuesday his dirty dealings were carried out with the knowledge, encouragement "and in some instances at the direction of" the company.
The company was founded and is run by Scott Salyer, 52, a member of a legendary farming family, whose grandfather came to California with nothing in the early part of the last century and built an agriculture empire, becoming one of the biggest land barons in the Central Valley.
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