FBI says beef plant investigation to expand to other states
HOLBROOK MOHR
Associated Press
Sun Herald
Jan. 28, 2006
JACKSON, Miss. - An investigation into a failed beef processing plant that has cost Mississippi millions of dollars and has already generated one guilty plea could spread to Tennessee and Georgia as investigators follow the money trail, the FBI says.
Mississippi Beef Processors president Richard N. Hall Jr. pleaded guilty on Wednesday to federal and state corruption charges, but Mississippi's top FBI agent says the second phase of the investigation is just getting started.
"Just because an indictment is returned or one part of a case comes to fruition doesn't necessarily mean there are not other spinoff cases," John G. Raucci, the special agent in charge in Mississippi, told The Associated Press on Friday.
Hall is facing two concurrent eight-year prison sentences for mail fraud and money laundering. He has agreed to cooperate in an investigation of the failed plant.
The plant operated for only three months in 2004, and its abrupt closing left the state of Mississippi holding a $43.5 million bill on a defaulted loan and 400 people without jobs.
The cost of the plant has ballooned to nearly $55 million with maintenance costs, grants and consulting fees.
Raucci said he could not discuss the investigation in detail but said it has led to Tennessee and Georgia.
Mississippi Attorney General Jim Hood has already set his sites on a Georgia company.
Hall had been sought out by other Mississippi officials because of his family's experience in the cattle business in Tennessee.
Hall and his father and brother owned Tennessee Dressed Beef Company near Nashville, among other ventures. But they quarreled over ownership in court before Richard Hall came to Mississippi, according to court records.
Hood has said he plans to sue Smyrna, Ga.-based Facility Group, a construction management company, hired by Community Bank and the Mississippi Development Authority to guide the troubled project to completion. Community Bank helped the state finance the plant.
The beef plant was hailed by many state officials as a way to create jobs in an economically struggling area and to help cattle farmers cut shipping costs by allowing them to process their cattle in state. But the project ran into problems almost immediately, and Facility Group was hired to bail it out.
Facility Group was paid $3.2 million for its services, which Hood said included paying contractors. Several vendors have not been paid a collective $1.7 million, Hood said.
Donya Edler, executive vice president for marketing at Facility Group, has said the company was responsible for the supervision of the project, not paying subcontractors and vendors.
Raucci would not say where the investigation has led in Tennessee, but he did say it involves individuals and not other corporations.
"I'm not suggesting that there were other businesses involved in other states. There are other individuals, though. Some have left the state of Mississippi," Raucci said. "Eventually, we're going to have to track some of those others down to refresh the stories that they told earlier."
Hood spokesman Jacob Ray said he could not comment on a Tennessee connection to the case. And Raucci said officials would likely remain tightlipped.
"I don't anticipate there being a lot of public comments in the near future," he said. "We have a lot of important work to do."
sunherald.com
HOLBROOK MOHR
Associated Press
Sun Herald
Jan. 28, 2006
JACKSON, Miss. - An investigation into a failed beef processing plant that has cost Mississippi millions of dollars and has already generated one guilty plea could spread to Tennessee and Georgia as investigators follow the money trail, the FBI says.
Mississippi Beef Processors president Richard N. Hall Jr. pleaded guilty on Wednesday to federal and state corruption charges, but Mississippi's top FBI agent says the second phase of the investigation is just getting started.
"Just because an indictment is returned or one part of a case comes to fruition doesn't necessarily mean there are not other spinoff cases," John G. Raucci, the special agent in charge in Mississippi, told The Associated Press on Friday.
Hall is facing two concurrent eight-year prison sentences for mail fraud and money laundering. He has agreed to cooperate in an investigation of the failed plant.
The plant operated for only three months in 2004, and its abrupt closing left the state of Mississippi holding a $43.5 million bill on a defaulted loan and 400 people without jobs.
The cost of the plant has ballooned to nearly $55 million with maintenance costs, grants and consulting fees.
Raucci said he could not discuss the investigation in detail but said it has led to Tennessee and Georgia.
Mississippi Attorney General Jim Hood has already set his sites on a Georgia company.
Hall had been sought out by other Mississippi officials because of his family's experience in the cattle business in Tennessee.
Hall and his father and brother owned Tennessee Dressed Beef Company near Nashville, among other ventures. But they quarreled over ownership in court before Richard Hall came to Mississippi, according to court records.
Hood has said he plans to sue Smyrna, Ga.-based Facility Group, a construction management company, hired by Community Bank and the Mississippi Development Authority to guide the troubled project to completion. Community Bank helped the state finance the plant.
The beef plant was hailed by many state officials as a way to create jobs in an economically struggling area and to help cattle farmers cut shipping costs by allowing them to process their cattle in state. But the project ran into problems almost immediately, and Facility Group was hired to bail it out.
Facility Group was paid $3.2 million for its services, which Hood said included paying contractors. Several vendors have not been paid a collective $1.7 million, Hood said.
Donya Edler, executive vice president for marketing at Facility Group, has said the company was responsible for the supervision of the project, not paying subcontractors and vendors.
Raucci would not say where the investigation has led in Tennessee, but he did say it involves individuals and not other corporations.
"I'm not suggesting that there were other businesses involved in other states. There are other individuals, though. Some have left the state of Mississippi," Raucci said. "Eventually, we're going to have to track some of those others down to refresh the stories that they told earlier."
Hood spokesman Jacob Ray said he could not comment on a Tennessee connection to the case. And Raucci said officials would likely remain tightlipped.
"I don't anticipate there being a lot of public comments in the near future," he said. "We have a lot of important work to do."
sunherald.com
