Court Limits National Cattlemen’s Beef Association’s Role in Federal Records Case

On Tuesday, NCBA’s attempt to delay and disrupt OCM’s search for the truth hit a snag when a federal court greatly limited its role in a lawsuit for beef checkoff records. A federal court allowed the National Cattlemen’s Beef Association (NCBA) a limited entry into a lawsuit brought by OCM to obtain audit records of the beef checkoff program. NCBA had been seeking full party status.

In part the court’s order stated,
“NCBA’s participation in this case is limited to reviewing documents and records for NCBA’s confidential and proprietary business information and objecting to the production of documents and records to OCM exclusively on the basis that those documents and records contain NCBA’s confidential and proprietary business information.”

“We are pleased that the judge stopped NCBA’s attempted overreach to keep the truth from the independent cattle producers who pay the mandated beef checkoff payments,” stated OCM board member Fred Stokes. “We are not seeking proprietary information, but we sure are demanding to see how our checkoff funds have been spent by NCBA, who we feel is responsible for hiding the truth from cattle producers. It’s our money; it’s our right to know.”

The order was issued in a lawsuit brought by OCM, demanding the Office of Inspector General (OIG) for the U.S. Department of Agriculture disclose its records relating to an audit of the federal beef checkoff.

OCM’s demand for the documents stems from the discrepancies between two audits. The first was a performance review conducted by Clifton Gunderson Accounting Firm (CG), commissioned by the Cattlemen’s Beef Board (CBB). The partial performance review uncovered irregularities in how NCBA was spending Beef Checkoff Program funds, resulting in NCBA having to return to the Cattlemen’s Beef Board (CBB) more than $200,000. These numerous irregularities included improper payment for such things as spousal travel and private loans.

The second audit was initiated by the USDA OIG. In 2011, following the CG performance review, OIG began their audit of USDA’s Agriculture Marketing Services (AMS), the agency whose responsibility is to oversee the checkoff programs. The investigation was completed in December of 2011, and 15 long months later a scant 17-page report was finally released (first “final” audit report).

This first “final” audit report concluded that NCBA had properly expended all Beef Checkoff Program funds and that the relationship between the CBB and the NCBA complied with U.S. law.

Because these OIG findings flew in the face of the CG 2010 performance review, OCM promptly filed their request under the Freedom of Information Act (FOIA) for an extensive list of records pertaining to the first “final” audit report. The OIG FOIA office initially responded by releasing 101 heavily redacted pages and denied release of the 3,120 pages of report drafts and 125 pages of related emails under a claim of exemption. Under this and other pressure, the first final audit report was withdrawn in July 2013.

Then on January 31, 2014, OIG issued a corrected final report, some 36 months after the initiation of the audit. This corrected final report withdrew OIG’s conclusions that the NCBA had properly expended all Beef Checkoff Program funds and that the relationship between the Beef Checkoff program’s Cattlemen’s Beef Board and the NCBA complied with U.S. law.

“We simply believe every cattle producer deserves to know the truth,” stated OCM President Mike Weaver. “We don’t think that it is too much to ask to know the truth on how our government mandated checkoff payments are being spent, especially when the primary contractor of the Beef Checkoff Program, the NCBA, claims membership of only 4% of cattle producers.”

Through the advancement of their anti-Country of Origin Labeling (COOL) efforts and other anti-independent family farm policies, OCM believes NCBA has contributed heavily in the destruction of our cattle markets. Calf prices are nearly half of what they were when COOL was in place. NCBA lobbied to abolish COOL on behalf of packers so that cheap imported South American beef could be secretly co-mingled with US beef.

“Enough is enough,” concluded Fred Stokes.