NEW YORK -- The U. S. Attorney here said eight current and former U. S. Department of Agriculture produce inspectors, as well as 13 other individuals associated with wholesale produce companies at the Hunts Point Terminal Market, Bronx, N.Y., were arrested last week on federal corruption charges.
payments from wholesalers in exchange for lowering the grade of inspected produce below that specified in the grower-wholesaler contract. The wholesalers would then renegotiate a lower price with the growers.
Between 6% and 10% of the produce sold at the market ends up in supermarkets, a spokeswoman for the Hunts Point Produce Cooperative told SN.
The indictment notes that even slight variances in grade can dramatically influence price, sometimes by several thousand dollars.
The indictment charges inspectors routinely accepted payments of $50 per truckload from wholesalers in exchange for downgrading produce.
The indictment also charges that, in exchange for kickbacks, supervisors would assign corrupt inspectors to perform inspections that would likely produce payments.
If convicted of racketeering, the inspectors face maximum sentences of 20 years in prison and a $250,000 fine, while the wholesalers face the same fine but only 15 years in prison.
"A few dishonest fruit and vegetable graders have preyed upon those who can afford it least -- our country's small farmers," said Roger C. Viadero, inspector general of the USDA.
Mary Jo White, U.S. Attorney for the Southern District of New York, said, "The charges announced today demonstrate our firm resolve to rid the Hunts Point market once and for all of the high cost of corruption."
According to Lewis D. Schiliro, assistant director of the FBI's New York field office, the inspectors and wholesalers "got Grade A goods at Grade B prices.
"It's fair to assume they didn't pass the savings on to the consumer," he added.
The wholesale firms whose owners or employees were cited in the indictment were Frankie Boy Produce Corp., Post & Taback, M. Trombetta & Sons, Cooseman Specialties, Fierman Produce Exchange, Koam Produce, Jacobson Produce, King Sol Produce, Tray-Wrap Produce, G&T Terminal Packaging Corp., B.T. Produce, Kleiman & Hochberg, and American Banana.
The defendants were scheduled to appear late last week in Manhattan federal court where a judge was to determine bail conditions.