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Senators Call for Investigation of USDA

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Harkin takes GIPSA to task
Thursday, January 19, 2006, 4:10 PM

by Tom Steever

The Grain Inspection Packers & Stockyards Administration (GIPSA) has been called on the carpet by the ranking Democrat on the Senate Agriculture Committee. A USDA Inspector General report requested last April by Iowa Senator Tom Harkin was issued Wednesday.

The report says that GIPSA hasn’t enforced the 85-year-old Packers and Stockyards Act. “I had no idea it was as bad as it is,” said Harkin Thursday. Further, according to Harkin, the report alleges that top GIPSA officials have actively blocked efforts to enforce it.

Harkin told reporters Thursday that the Senate Agriculture Committee should take additional action. “I really think this requires further investigation,” Harkin said, referring to the agency, “and quite frankly, I think the Agriculture Committee ought to meet, we ought to subpoena some of these people, put them under oath and find out just what is going on down there.”

Harkin says the Senate Ag Committee should compel current and former high-ranking GIPSA officials to testify, although he concedes he can't make that happen on his own.
--------------------------


Today 1/19/2006 6:45:00 PM


Sen. Burns: USDA Must Better Regulate Packers



Washington, D.C. – U.S. Senator Conrad Burns (R-Mont.) expressed his concern today over a report by the U.S. Department of Agriculture (USDA) Office of Inspector General (OIG) citing significant failures in the USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) oversight and enforcement of the Packers and Stockyards programs.



“The findings of this report are deeply troubling. The officials at GIPSA need to wake up and do the job they’re charged with, and that’s enforcing the Packers and Stockyards Act,” said Senator Burns. “Our Montana producers have long complained about anti-competitive behavior and botched investigations and this report bears that out."



The report found that the agency inflated reports of investigative actions, including classifying routine activities such as sending letters as an investigation. Regional offices were directed to classify certain activities as investigations, and one regional office was reprimanded for failing to expand its definition of investigations.



The audit also noted that the agency lacked internal controls to ensure that investigations were thoroughly completed, and that headquarters often failed to take action on requests for policy guidance. The agency had 64 policy issues waiting for action, many of which had been delayed for more than a year. In two cases, policy issues had been waiting since 2000. Finally, the report noted that past recommendations from the OIG as well as the Government Accountability Office had not been fully implemented.



"I urge Administrator Link to take this report seriously and take comprehensive action to ensure competition in the livestock industry. I understand that the agency has taken some actions already to remedy these flaws, but this audit notes that the agency has had trouble in the past with fully implementing reforms," said Burns, a senior member of the powerful Senate Appropriations Committee. "When we review the agency's budget requests for this year, I intend to raise these findings with USDA and ensure that meaningful action has been taken."

 

PORKER

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What an QUOTE' “I had no idea it was as bad as it is,” ----------------SSSOOOOOOOOOOOO In two cases, policy issues had been waiting since 2000. WAS THIS THE PICKET RESPONSE?????Finally, the report noted that past recommendations from the OIG as well as the Government Accountability Office had not been fully implemented. GIVE EM HELL MRS. FONG, OIG Chief
 

Econ101

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Oldtimer said:
--------------------------------------------------------------------------------
Harkin takes GIPSA to task
Thursday, January 19, 2006, 4:10 PM

by Tom Steever

The Grain Inspection Packers & Stockyards Administration (GIPSA) has been called on the carpet by the ranking Democrat on the Senate Agriculture Committee. A USDA Inspector General report requested last April by Iowa Senator Tom Harkin was issued Wednesday.

The report says that GIPSA hasn’t enforced the 85-year-old Packers and Stockyards Act. “I had no idea it was as bad as it is,” said Harkin Thursday. Further, according to Harkin, the report alleges that top GIPSA officials have actively blocked efforts to enforce it.

Harkin told reporters Thursday that the Senate Agriculture Committee should take additional action. “I really think this requires further investigation,” Harkin said, referring to the agency, “and quite frankly, I think the Agriculture Committee ought to meet, we ought to subpoena some of these people, put them under oath and find out just what is going on down there.”

Harkin says the Senate Ag Committee should compel current and former high-ranking GIPSA officials to testify, although he concedes he can't make that happen on his own.
--------------------------


Today 1/19/2006 6:45:00 PM


Sen. Burns: USDA Must Better Regulate Packers



Washington, D.C. – U.S. Senator Conrad Burns (R-Mont.) expressed his concern today over a report by the U.S. Department of Agriculture (USDA) Office of Inspector General (OIG) citing significant failures in the USDA’s Grain Inspection, Packers and Stockyards Administration (GIPSA) oversight and enforcement of the Packers and Stockyards programs.



“The findings of this report are deeply troubling. The officials at GIPSA need to wake up and do the job they’re charged with, and that’s enforcing the Packers and Stockyards Act,” said Senator Burns. “Our Montana producers have long complained about anti-competitive behavior and botched investigations and this report bears that out."



The report found that the agency inflated reports of investigative actions, including classifying routine activities such as sending letters as an investigation. Regional offices were directed to classify certain activities as investigations, and one regional office was reprimanded for failing to expand its definition of investigations.



The audit also noted that the agency lacked internal controls to ensure that investigations were thoroughly completed, and that headquarters often failed to take action on requests for policy guidance. The agency had 64 policy issues waiting for action, many of which had been delayed for more than a year. In two cases, policy issues had been waiting since 2000. Finally, the report noted that past recommendations from the OIG as well as the Government Accountability Office had not been fully implemented.



"I urge Administrator Link to take this report seriously and take comprehensive action to ensure competition in the livestock industry. I understand that the agency has taken some actions already to remedy these flaws, but this audit notes that the agency has had trouble in the past with fully implementing reforms," said Burns, a senior member of the powerful Senate Appropriations Committee. "When we review the agency's budget requests for this year, I intend to raise these findings with USDA and ensure that meaningful action has been taken."

They will try to link Burns with some other money deal to discredit him. Oh, they already have. That is the problem with the system right now. There are ways the packers have of discrediting those who do not fall in line. You gotta really like a guy (or gal) who will stand up to these guys. When they stand up to them, they are giving a little self interest up for the common good. I don't expect everyone to be perfect, but that is no excuse to be bad.

Ken Lay and Enron went as far as it did because of the same problem.
 

flounder

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Audit Report

Grain Inspection, Packers and Stockyards Administration’s Management and
Oversight of the Packers and Stockyards Programs

Report No. 30601-01-Hy January 2006



UNITED STATES DEPARTMENT OF AGRICULTURE

OFFICE OF INSPECTOR GENERAL

Washington D.C. 20250

January 10, 2006

REPLY TO

ATTN OF: 30601-01-Hy

TO: James E. Link

Administrator

Grain Inspection, Packers and Stockyards Administration

ATTN: S. Brett Offutt

Director

Policy and Litigation Division

FROM: Robert W. Young /s/

Assistant Inspector General

for Audit

SUBJECT: Grain Inspection, Packers and Stockyards Administration’s
Management and Oversight of the Packers and Stockyards Programs

This report presents the results of our audit of the Grain Inspection,
Packers and Stockyards Administration’s management and oversight of the
Packers and Stockyards programs Your response to the official draft, dated
January 5, 2006, is included as exhibit A. Excerpts of your response and the
OIG’s position are incorporated into the Findings and Recommendations
section of the report. Based on your response, we were able to reach
management decision on the report’s ten recommendations. Please follow your
agency’s internal procedures in forwarding documentation for final action to
the Office of the Chief Financial Officer.

We appreciate the courtesies and cooperation extended to us by members of
your staff during this audit.

USDA/OIG-AUDIT No. 30601-01-Hy Page i

Executive Summary

Grain Inspection, Packers and Stockyards Administration’s Management and
Oversight of the Packers and Stockyards Programs (Audit Report No.
30601-01-Hy)

Results in Brief The Grain Inspection, Packers and Stockyards Administration
has not established an adequate control structure and environment that
allows the agency to oversee and manage its investigative activities for the
Packers and Stockyards Programs (P&SP). Our review identified three material
weaknesses that have not been previously disclosed in the agency’s annual
Federal Managers Financial Integrity Act (FMFIA) report. We found that P&SP
had difficulties:


• Defining and tracking investigations,


• Planning and conducting competition and complex investigations, and

• Making agency policy.

As a result, P&SP’s tracking system could not be relied upon, competition
and complex investigations were not being performed, and timely action was
not being taken on issues that impact day-to-day activities. These material
weaknesses should be reported in the agency’s next FMFIA report because they
represent essential activities for administering and enforcing the Packers
and Stockyards Act of 1921 (Act). The Act prohibits unfair, unjustly
discriminatory, and deceptive acts and practices, including certain
anti-competitive practices. We also found that the agency has not taken
sufficient actions to strengthen operations in response to findings
previously reported by the Office of Inspector General (OIG) in February
1997 and the Government Accountability Office (GAO) in September 2000. Our
current work was initiated in response to concerns raised by a U.S. Senator
in April 2005.

P&SP is responsible for maintaining fair trade practices in the marketing of
livestock, providing financial protection for participants in livestock
transactions, and ensuring open competitive marketing conditions for
livestock and meat. To accomplish our work, we evaluated P&SP’s management
and oversight of its competition and complex investigations. We also
examined P&SP’s ability to track its investigations (i.e., financial
protection, trade practice, and competition). We did not evaluate P&SP’s
management and oversight of its financial protection and trade practice
investigations.

According to established standards for internal control,1 P&SP managers and
staff should establish and maintain an environment throughout the
organization that sets a positive and supportive attitude. This type of
environment is the foundation for effective internal control and provides
the discipline, structure,

1 GAO’s Standards for Internal Control in the Federal Government, dated
November 1999, and the Office of Management and Budget’s Circular No. A-123,
Management’s Responsibility for Internal Control, dated December 2004.

USDA/OIG-AUDIT No. 30601-01-Hy Page ii

and climate that influence quality performance. We found that this type of
environment did not exist between P&SP managers and staff.

2 P&SP’s inability to accurately and completely track its inventory of
investigations limited the scope of our work. See Scope and Methodology for
additional details.

3 The control is the SMRP, which includes the Deputy Administrator and the
Division Directors for Policy and Litigation, Industry Analysis, and
Regional Operations.

4 P&SP defines complex investigations as those that involve (1) more than
one unit or region, (2) a substantial number or amount of resources, (3) a
major firm, or (4) a novel legal theory.

Inability to Track Investigations. P&SP’s tracking system counted all P&SP
activities as "investigations" because there was no policy to define
investigations. These activities included monitoring publicly available
data, sending routine letters to request company-specific information, and
performing onsite reviews of companies. In addition, records in the tracking
system were not complete because there were no procedures for validating the
accuracy and completeness of information recorded. Consequently, data fields
were left blank. As a result, the system could not be relied upon as a
control for managing P&SP investigations.2

According to P&SP data, the agency was tracking a total of 1,842
investigations as of June 30, 2005. The records, however, could not be used
to identify the location of work performed (i.e., the P&SP office or the
regulated entity’s place of business) for 1,799 of the 1,842 investigations.
In addition, agency records were incomplete for 973 of the 1,842
investigations.

Weak Management Control. As implemented, P&SP’s control3 for managing
competition and complex4 investigations inhibits the agency’s ability to
investigate them. The Senior Management Review Panel (SMRP) does not clearly
establish a process for identifying the work to be performed, approving work
plans, performing the fieldwork and analysis, and reporting on the results.
Consequently, no competition and complex investigations were being
completed. As of August 29, 2005, all of these investigations, a total of
50, were engaged in the process of being approved by SMRP. Three of these
investigations were opened in 2003, and one was opened over 3 years ago in
July 2002.

Since P&SP is not performing competition and complex investigations, no
referrals were being made to the Office of the General Counsel (OGC) for
formal administrative action. In February 2005, P&SP referred one
competition investigation to OGC. The most recent referral prior to February
2005 was November 2002, over 2 years earlier. OGC filed no administrative
complaints against market participants for anti-competitive practices since
1999 due to the lack of referrals by P&SP.

No Decisions on Policy. Due to P&SP’s inadequate control structure, the
agency was not making decisions on policies and requests for guidance from
P&SP staff. A policy group was created in June 2005; however, P&SP has not

USDA/OIG-AUDIT No. 30601-01-Hy Page iii

established the structure this group will use for receiving, reviewing, and
acting on policy questions raised by P&SP staff. As a result, timely action
is not being taken on issues that impact the day-to-day business activities
of producers and the entities P&SP regulates (e.g., packers, stockyards, and
live poultry dealers).

We identified 64 policy issues that were awaiting decisions in P&SP
Headquarters as of September 30, 2005. These issues cover all types of P&SP
investigations (e.g., trade practice, financial protection, and competition)
and a variety of topics to be addressed by the Deputy Administrator and the
Policy and Litigation Division. For 55 of the 64 issues, guidance was
requested prior to 2004, with 2 submitted in 2000.

Prior Advice Not Implemented. In prior reports, OIG and GAO advised on ways
for P&SP to better allocate its resources to monitor the market for
anti-competitive behavior. In response, P&SP initiated actions to strengthen
program operations. We found that P&SP reorganized its operations in 1998
and charged the three Regional Offices with maintaining a high level of
expertise in one or more species of livestock. In addition, P&SP assessed
its staff’s qualifications and hired staff with legal, economic, and
statistical backgrounds.

We found that the actions taken in four areas, however, were not sufficient.
P&SP did not identify this because the agency did not have a process for
ensuring that agreed upon corrective actions were implemented. We found that
P&SP did not: (1) effectively integrate economists into the investigations,
(2) empower the agency’s legal specialist to consult with OGC, (3) hire a
manager with experience in leading P&SP investigations, and (4) develop a
teamwork approach for investigations with P&SP’s economists and OGC’s
attorneys.

Because of the weaknesses in P&SP’s control for managing competition and
complex investigations and P&SP’s lack of action to prior advice from OIG
and GAO, we did not further examine the agency’s allocation and use of
resources for P&SP investigations.

Recommendations

In Brief P&SP needs to implement a policy for defining investigations, which
requires P&SP personnel to differentiate between activities to perform
onsite reviews of companies from those to monitor publicly available data
and send routine letters to request company-specific information. P&SP also
needs to implement procedures for recording data in the agency’s tracking
system and for validating the accuracy and completeness of the information
recorded. The agency needs to implement a well defined process for timely
identifying the work to be performed, preparing and approving work plans,
performing the fieldwork and analysis, and reporting on the results. In
order to appropriately and timely respond to policy issues and requests for
guidance, the agency needs to develop

USDA/OIG-AUDIT No. 30601-01-Hy Page iv

and implement a structure for receiving, reviewing, and acting on them.
Finally, P&SP needs to develop and implement an internal review function to
monitor and report on agency activities.

Agency Response GIPSA agreed with the report’s recommendations. We have
incorporated the agency’s response in the Findings and Recommendations
section of this report, along with the OIG position. The response is
included as Exhibit A.

OIG Position Based on the response, we were able to reach management
decision on the report’s 10 recommendations.

USDA/OIG-AUDIT No. 30601-01-Hy Page v

Abbreviations Used in This Report

Act Packers and Stockyards Act of 1921

FMFIA Federal Managers Financial Integrity Act

FY Fiscal Year

GAO Government Accountability Office

GIPSA Grain Inspection, Packers and Stockyards Administration

OCFO Office of the Chief Financial Officer

OGC Office of the General Counsel

OIG Office of Inspector General

P&SP Packers and Stockyards Programs

PLD Policy and Litigation Division

SMRP Senior Management Review Panel

USDA U.S. Department of Agriculture

...................snip.........full text 36 pages ;


http://www.usda.gov/oig/webdocs/30601-01-HY.pdf



TSS
 

PORKER

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Packers
and Stockyards Act of 1921 (Act). The Act prohibits unfair, unjustly
discriminatory, and deceptive acts and practices, including certain
anti-competitive practices. We also found that the agency has not taken
sufficient actions to strengthen operations in response to findings
previously reported by the Office of Inspector General

Somebody had clout to shut the door on conducting competition and complex investigations!!!!!!!
 
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Anonymous

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stetson said:
I am very supprised we have not heard from SH or Agman
Wonder where they are hideing

They only comment on things they can spin, discredit by playing figures to their advantage, or issues that play to their advantage.....

I guess the gophers have been misleading them again :wink: :lol: :lol:

Haven't heard from Maxine either :lol: :lol:
 

agman

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Oldtimer said:
stetson said:
I am very supprised we have not heard from SH or Agman
Wonder where they are hideing

They only comment on things they can spin, discredit by playing figures to their advantage, or issues that play to their advantage.....

I guess the gophers have been misleading them again :wink: :lol: :lol:

Haven't heard from Maxine either :lol: :lol:

What proof do you have that any of the items listed resulted in a cover up anywhere or improprieties? You are about as bad as Econ. All talk no facts. Just because you live in a world of accusations and innuendos do you expect everyone else too? Is that why you get stumped by numbers and facts? If you think you are smart enough to discredit any figures I present please do. I am anxiously awaiting the challenge. You have certainly struck out at every legal turn-and you were a judge?

If packers or anyone truly violates a law I am all for dishing out the proper punishment. I don't however buy into the endless stream of accusations without supporting facts. That is especially so from the many individuals who have never sold a fed animal to a pcaker, set foot into a plant or ever talked to company management yet claim to know more than the packer. Your positions are a product of ignorance of the facts.

I will leave the accusations to you and a few others like you on these forums - always negative and always accusing. You seem to have mastered that ability. Why do you even get out of bed in the morning; do you even trust yourself?
 
A

Anonymous

Guest
agman said:
Oldtimer said:
stetson said:
I am very supprised we have not heard from SH or Agman
Wonder where they are hideing

They only comment on things they can spin, discredit by playing figures to their advantage, or issues that play to their advantage.....

I guess the gophers have been misleading them again :wink: :lol: :lol:

Haven't heard from Maxine either :lol: :lol:

What proof do you have that any of the items listed resulted in a cover up anywhere or improprieties? You are about as bad as Econ. All talk no facts. Just because you live in a world of accusations and innuendos do you expect everyone else too? Is that why you get stumped by numbers and facts? If you think you are smart enough to discredit any figures I present please do. I am anxiously awaiting the challenge. You have certainly struck out at every legal turn-and you were a judge?

If packers or anyone truly violates a law I am all for dishing out the proper punishment. I don't however buy into the endless stream of accusations without supporting facts. That is especially so from the many individuals who have never sold a fed animal to a pcaker, set foot into a plant or ever talked to company management yet claim to know more than the packer. Your positions are a product of ignorance of the facts.

I will leave the accusations to you and a few others like you on these forums - always negative and always accusing. You seem to have mastered that ability. Why do you even get out of bed in the morning; do you even trust yourself?

Simple Agman- If you don't investigate, you don't find and If you're told not to/ or you can't investigate, its COVERUP....

Doesn't surprise me that YOU would back the USDA even on this one....
 

the chief

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agman: What proof do you have that any of the items listed resulted in a cover up anywhere or improprieties? You are about as bad as Econ. All talk no facts.

Yeah, and Richard Nixon was innocent of all charges. He was pardoned wasn't he?

OJ is "not guilty."

Vietnam was not a war.

Enron is a reputable company.

Ken Lay is a saint.

:wink: :wink: :wink:
 

PORKER

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P&SP is responsible for maintaining fair trade practices in the marketing of
livestock, providing financial protection for participants in livestock
transactions, and ensuring open competitive marketing conditions for
livestock and meat PRODUCERS.
 

Econ101

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GIPSA still believes that contracts overule the PSA. If that is the case, where private contracts overule the law, there is a lot of things that are going to change in this country. It shows the competence of those administering the agency---or their ability to bend over backwards to those with market power.
 

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