Lynch Livestock, an Iowa company, must close its two pig-buying stations in South Dakota for 15 days as part of its punishment for defrauding livestock producers and farmers in Iowa, reports Keloland Media Group. The company must also post a $100,000 letter of credit as possible restitution for any claims that a South Dakota farmer or livestock producer might bring in the next three years regarding the company’s illegal actions, the article said.
On Tuesday, the company agreed to the terms with the South Dakota Animal Industry Board that is responsible for the health of livestock and their marketing in South Dakota.
On February 10, 2023, the U.S. Justice Department announced that Lynch Family Companies, Inc., of Waucoma, Iowa, also known as “Lynch Livestock,” was sentenced to five years of federal probation, fined $196,000 and ordered to pay more than $3 million in restitution to producers and sellers who took swine to the company’s Iowa buying stations.
Lynch Livestock pled guilty on July 29, 2022, to “Failing to Comply with an Order of the Secretary of Agriculture.” Four men involved in the company’s purchases of pigs also pleaded guilty that summer and one was sentenced to six months in federal prison, Keloland reports.
The scheme victimized livestock producers throughout the Midwest, the United States Attorney’s Office in the Northern District of Iowa in a release in 2023. As a registered dealer with the Secretary of the USDA under the Packers and Stockyards Act of 1921, the company bought swine from livestock producers and sellers at stations across Iowa and surrounding areas, paying prices based on the numbers, classifications and weights of the animals.
“Beginning in about the early 2000s, and continuing through at least late March 2017, Lynch Livestock’s second-ranking official directed other managers and employees to falsely reduce and downgrade the numbers, quality classifications and weights of swine that producers and sellers had delivered to Lynch Livestock’s buying stations throughout the Midwest,” the release stated.
Furthermore, managers at Lynch Livestock’s headquarters created false and fraudulent scale tickets, including the use of a crowbar or other object to manipulate the livestock scales, bearing the initials of managers at the buying stations, as well as produced false and fraudulent invoices to pay less than what was due to producers. The company’s managers and employees then proceeded to shred and burn evidence of fraud as document destruction was a routine practice of the company, the release said.
Anamarie Judd-Hermesch, Lynch Livestock’s livestock compliance officer who joined the company in 2022, emphasized Tuesday to the South Dakota board that no evidence has surfaced of such activities occurring at the company’s South Dakota buying stations, which are in Aberdeen and Alexandria, Keloland reports.
The board’s lawyer, Chelsea Wenzel from the South Dakota Attorney General’s office, noted that Lynch Livestock applied for renewal of its South Dakota license in 2023. Because of the violation, she said, the board could either deny the license or suspend it for up to one year, the article said.
Lynch agreed to a 15-day suspension and the $100,000 letter of credit. The restitution would apply to any instance where a South Dakota producer or seller could prove damage was committed by Lynch Livestock on or before February 10, 2023, Keloland reports.
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Livestock Dealer And Four Managers Sentenced After Nearly Two-Decade Long Fraud Scheme
