Well, no wonder. Randall Lee Rahal explains it all. He was on the board of directors for SK Foods. He's from New Jersy, but is visiting here. Yesterday, he was in federal court downtown to plead guilty to charges that he used SK money to bribe purchasing managers of the food industry giants. These managers bought SK products at inflated prices and supplied SK with competitors' bids and other proprietary info. He also admitted conspiring with SK to defraud customers by supplying inferior and mislabeled products.

Wow, a greedy corp caught in collusion with farmers, processors and retailers, driving up the price of groceries.

Go figure. I wonder if SK were the only ones fixing prices?

Geez!

I think if they would stop charging twice as much to take stuff OUT...they would find people spending more on food.

"Hey..we have lower or no sodium now"..sadly, we had to double the cost to take it out and call it healthy.

and why, when gas prices are now at a five year low, has ony one airline gotten rid of its fuel surcharge?

edited due to I can't type in the dark

http://www.sacbee.com/topstories/story/1482236.html

Wiretaps record alleged bribery at SK Foods
By Denny Walsh
dwalsh@sacbee.com
Published: Thursday, Dec. 18, 2008
When Randall Rahal talked on the phone between June 4, 2007, and April 23, 2008, the FBI was listening.

Rahal, a New Jersey sales broker, has admitted being the bag man for bribes paid by SK Foods, a California-based processor of tomatoes and other products, to assure sales of SK products at inflated prices to major food companies.

The evolving probe of the Monterey-based food processing giant now centers on Rahal, who is cooperating with federal prosecutors.

So far he is the only one charged in the investigation.

But his conversations with SK personnel, including founder and owner Scott Salyer, are revealing. Excerpts of the court-ordered wiretaps are in an FBI affidavit on file in Sacramento federal court.

In a series of calls between Rahal, Salyer and an unidentified SK employee, bribing a company's purchasing manager is allegedly discussed.

The purchasing manager is "gonna need a retirement program," Rahal tells Salyer. "So, it's a perfect fit for me."

Salyer asks, "How fast are you going to reel in that fish?"

Rahal, who had a dinner meeting scheduled with the purchasing manager, tells Salyer, "Probably by the time the coffee comes that'll be done."

"I want that sucker on speed reel," Salyer said. "You know, that big electric reel."

In a statement, SK Foods said it abhors what Rahal has done, has cut ties to him, and is cooperating with the government's ongoing investigation.

Salyer's office referred inquiries to a San Francisco attorney, but that lawyer said he represents only SK and that a New York City attorney represents Salyer. The latter attorney did not return a phone message.

For more than three years federal agencies have investigated possible market manipulation in the food industry.

In addition to the probe of SK Foods there are ongoing investigations of the egg and citrus markets, Gina Talamona, spokeswoman for the U. S. Department of Justice's Antitrust Division, said Wednesday.

The type of conduct to which Rahal has admitted as part of a plea bargain deprives purchasers "of the benefits of a competitive marketplace, ultimately causing American consumers to pay higher prices for these everyday staples," Assistant Attorney General Deborah Garza said last week.

Between 1993 and April, when the 59-year-old Rahal was associated with SK in a number of capacities, he came up with at least three ways to cheat the firm's customers. By 2004, SK was operating as a "racketeering enterprise," federal prosecutors contend.

In one recorded conversation, Rahal tells Salyer he might hire a customer's purchasing manager.

"I'm just not ready to bring (him) here," Rahal says. "First of all, (he) is a … crook. Second of all, I need him where he is right now."

Salyer replies, "Crooks are handy on the inside."

"As long as they're your crooks," Rahal says. "Remember that; they gotta be your crooks. We've got a few; I've got a list."

Salyer agreed: "They're the only ones I like – our crooks."

Records collected by investigators show Rahal paid hundreds of thousands of dollars in bribes to the biggest names in the food industry while collecting healthy commissions for himself. An SK Foods brokerage register shows that in one year his company, Intramark USA, Inc., was paid $1.1 million in commissions.

"SK Foods, with the assistance of Rahal, knowingly and routinely sold processed tomato product to customers that did not meet customer specifications and falsified both internal documentation and customer-bound product labels, quality control documents, bills of lading and certificates of analysis in order to make it appear as if the … product … was compliant with contract requirements," according to a written plea agreement signed by Rahal.

The scheme involved various misstatements "concerning both the quality and content of the product."

A 2007 transaction with New Jersey-based food distributor B&G Foods Inc. is an example of how a Rahal deal worked:

In June of that year a call was intercepted between Rahal and B&G's corporate purchasing manager, during which they appear to agree to "split the penny" on chili contracts; the manager would get a kickback of a half cent per pound on chilies B&G bought from SK. Rahal would get the other half cent.

"I don't know how big your chili purchase is, but it can be a lot of money," Rahal told the manager. "It's your kids' education."

B&G contracted to buy 13 million pounds of chilies at 22 cents per pound. Subsequently, according to court records, Rahal and the manager agreed to hike the price. The manager told his company this was necessary due to increased production costs SK was experiencing.

The contract price wound up at 25 cents per pound for 6.5 million pounds and 28.5 cents for the other half of the order.

Rahal kicked back $65,000 to the manager.



Payments were meant to subvert bidding and guarantee sales at higher prices of tomato paste, jalapeño peppers and other goods to Kraft Foods Inc.; H.J. Heinz Co.; McCormick & Co. Inc.; Frito-Lay North America; Safeway Inc.; ConAgra Foods Inc.; Agusa; B&G Foods; and others.