Tomato company baron Frederick Scott Salyer on Friday pleaded guilty in federal court in Sacramento to racketeering and an anti-trust offense in connection to his company SK Foods, which engaged in a pattern of bribes and kickbacks with customers, reports the Sacramento Business Journal.
Salyer, 56, of Pebble Beach, Calif., must forfeit $3.25 million dollars transferred to a bank account in Andorra in 2010 and faces between four and seven years in prison.
According to prosecutors, SK Foods made payments to purchasing agents at companies such as Kraft Foods and Safeway, giving SK Foods an advantage over its competitors. All of the purchasing managers have pleaded guilty. The behavior was done with Slayer’s “knowledge and encouragement,” U.S. Attorney Benjamin Wagner said.
SK Foods also defrauded its customers between 2003 and 2008 by routinely falsifying various grading factors and data relating to its own products. That included mold content and whether the product qualified as organic.
The defendants who have pleaded guilty in the case include five former officers of SK Foods, the owner of a brokerage company and former purchasing managers.
Investigators from the FBI, the IRS and others started working the case in 2006.
They found Salyer’s company manipulated prices on millions of pounds of processed tomatoes and improperly influenced supermarkets and big food companies into buying substandard tomato products, the Journal reports
“Salyer and the defendants’ scheme ripped off consumers, reaped big profits and ultimately endangered our community,” and sold tomato products there unsalable in the U.S. due to excessive mold content, said Rick Goss, IRS special agent in charge.