Four indicted in Rancho Feeding slaughterhouse scandal

Two former owners and two employees of a Petaluma slaughterhouse at the center of an international meat recall have been charged with selling meat from diseased cattle and concealing the elaborate scheme from federal inspectors by swapping out the heads of cows with eye cancer.

Rancho Feeding Corp. co-owner Robert Singleton, 77, of Petaluma, is cooperating with prosecutors and expected to plead guilty to a single count of distribution of adulterated meat, according to court records unsealed Monday.

His former partner, Jesse “Babe” Amaral Jr., and two Rancho employees are accused of circumventing U.S. Department of Agriculture inspection procedures and processing the diseased meat in violation of federal law, according to an 11-count federal indictment.

The charges cap an eight-month federal investigation that followed a massive meat recall at the former Rancho plant on Petaluma Boulevard North. The slaughterhouse closed in February after recalling 8.7 million pounds of its beef and veal sold in the United States and Canada - all that was processed there in 2013.

Roughly 44,000 retail establishments were involved in the recall, a USDA official told local farmers. The action also caused considerable financial harm to North Bay ranchers who had used the plant for the custom slaughter of their grass-fed cattle and were ordered to dispose of any remaining meat.

The indictment, which was returned last Thursday by a federal grand jury and unsealed Monday in U.S. District Court in San Francisco, named Amaral, 76, of Petaluma; Rancho foreperson Felix Cabrera, 55, of Santa Rosa; and Eugene Corda, 65, of Petaluma, who was the facility’s main yard person, responsible for receiving cattle and moving them for inspection and slaughter. Singleton was charged in a separate filing.

Amaral and Corda pleaded not guilty to the charges Monday in U.S. District Court and were released on $50,000 bond, according to court records. Singleton is scheduled to appear in court Friday. Cabrera has not yet made his initial appearance, according to prosecutors and court records.

News of the charges sent ripples through the North Bay farming community, where Amaral, Singleton and Corda were longtime members with extended families.

“It’s hard to take because they’ve been in the community for so long,” said Stephanie Larson, director of the UC Cooperative Extension program in Sonoma County, which advises local farmers. The allegations, if true, would amount to a “black eye” for North Bay agriculture, she said.

As well, farm officials, food safety advocates and the region’s two members of Congress voiced concerns about how much remains unknown.

“The allegations in the indictment are shocking, but there are still many unanswered questions about how this could have happened at a federally inspected slaughter facility,” said Tim Tesconi, executive director of the Sonoma County Farm Bureau.

Prosecutors said Singleton, Rancho’s cattle buyer, purchased animals with lumps or other abnormalities around the eye, signs of possible eye cancer, which made them less expensive than healthy cattle.

The indictment alleged that Amaral and Singleton directed their two employees to circumvent the inspection process for diseased cows.

Federal prosecutors allege that Cabrera, or another kill floor employee at his instruction, fooled inspectors by placing heads from apparently healthy cows next to carcasses of cows with eye cancer, making the diseased carcasses appear healthy. The indictment stated that this “switch and slaughter” of uninspected cows with eye cancer occurred during the lunch break taken by federal meat inspectors, at a time when plant operations were supposed to cease.

Amaral allegedly directed Cabrera to order employees on the kill floor to carve “USDA Condemned” stamps out of cattle carcasses and process the carcasses for sale and distribution.

Between January 2013 and January 2014, Rancho processed and distributed carcasses and meat from approximately 101 condemned cattle and 79 cows afflicted with eye cancer, according to the indictment.

Rancho paid Cabrera about $50 for each carcass that was slipped past inspectors, the indictment alleged.

Inspectors were not the only ones who were deceived by Rancho, prosecutors claim. Amaral allegedly billed farmers for the cost of disposing of sick and condemned cows, even though he had secretly sold the meat as healthy, according to the indictment. The indictment charges him with three counts of mail fraud in connection with the alleged billings.

Amaral, Cabrera and Corda are all charged with conspiracy to distribute adulterated meat and conspiracy to commit mail fraud, among other charges. The maximum penalty for mail fraud and conspiracy to commit mail fraud is 20 years in federal prison.

Amaral’s attorney did not return a phone call Monday seeking comment. Singleton also did not return calls seeking comment. Corda and Cabrera could not be reached for comment.

Until Monday, USDA officials had publicly said little more than Rancho had circumvented inspection rules and processed “diseased and unsound animals.” Such a lack of details had set off considerable speculation that was not quieted by Monday’s revelations.

“What we don’t know is probably more than what we know,” Rep. Mike Thompson, D-St. Helena, said Monday.

Rep. Jared Huffman, D-San Rafael, said he was “surprised at how narrow” the indictment is, maintaining it does not support the recall ordered by the USDA.

“If there’s not much more than this to explain the breadth of this recall, then I think USDA has some serious explaining to do,” Huffman said.

He said “conspicuously absent” from the indictment was any mention of a USDA veterinarian who Huffman said was “either so negligent or complicit” in the alleged criminal activity at the Petaluma facility that the person quit after the recall was announced.

He said the document also doesn’t mention a USDA inspector who allegedly was involved in an intimate relationship with an employee of the slaughterhouse.

Huffman on Monday reiterated his call for the USDA to speed up its review of the problems at the slaughterhouse. Thompson and Huffman are seeking an additional $1 million for the agency’s inspector general to assist in the investigation. The amendment passed the House of Representatives.

Huffman said he tried contacting an undersecretary at the Department of Agriculture Monday seeking information about the agency’s investigation but he hadn’t heard back. He said similar calls in the past have been ignored.

“I’m not going to let this go. We’re just not going to let this be forgotten,” he said.

A USDA spokesperson referred questions Monday to the U.S. Attorney’s Office.

Other critics noted that a USDA inspector at Rancho had raised concerns about the number of old cows with eye cancer being processed at the facility. A Rancho supervisor confirmed her concerns, noting them in an Oct. 28, 2013 letter to USDA as evidence of the unreasonable approach the inspector was taking toward the company.

Paul Corbo, a senior lobbyist with Food & Water Watch, a consumer advocacy group in Washington, D.C., said Rancho appeared to need an extra inspector on hand when cattle were first delivered to the slaughterhouse. Such extra staff had been recommended after an earlier problem at another slaughterhouse, he said.

While perhaps not preventing all the deception, “you probably would have stopped a lot of this from happening,” Corbo said.

An official for the inspector’s union blamed “management failure” for what happened at Rancho. While insisting the plant’s inspectors knew nothing of the wrongdoing, he disputed prosecutors’ explanation that the Rancho employees could have processed all the diseased or condemned cows during the lunch hour.

“No, it’s too noisy,” said Paul Carney, one of eight council presidents on the National Joint Council of Inspection Locals. He also questioned what role the USDA veterinarian had played in overseeing the plant.

The government’s actions also have drawn sharp criticism from custom beef ranchers who hired Rancho Feeding to process their animals and found their beef recalled.

Bill Niman, a Bolinas cattleman who said he had almost $400,000 of his high-end beef tied up in the recall, on Monday said the indictment supports his contention that his cattle should never have been wrapped up in the ordeal. He said the 180 diseased cows referenced in the indictment could not have come from his farm, as the animals that were processed illegally likely were larger dairy cows sold by the pound as commodities.

“We’ve been wronged,” Niman said. “I wish the federal government would have taken a little more responsibility for throwing us under the bus, along with other people who should not have been included in this entire effort.”

Niman said he was forced to sell a little more than 50,000 pounds of recalled beef to a Sacramento rendering plant two weeks ago because he could no longer afford to freeze it. He said he gave an additional 30,000 pounds away to family and friends.

The slaughterhouse re-opened in April under the ownership of a group of investors led by Marin Sun Farms CEO David Evans, who has promised to focus on the ethical treatment of animals. Evans did not return telephone calls seeking comment.