OCM Responds to NCBA’s Attempt to Cover Up Abuses of Beef Checkoff Funds


On Friday, September 30, 2016, attorneys for the Organization for Competitive Markets (OCM) filed their response in the U.S. District Court for the District of Columbia to the National Cattleman Beef Association’s (NCBA) late attempt to intervene in a case filed by OCM to obtain records from the Office of Inspector General (OIG) related to Beef Checkoff Program activities.

In October of 2014, OCM filed the original complaint for injunctive relief, demanding the OIG for the U.S. Department of Agriculture make a final determination and release all required records related to a 2013 Freedom of Information Act (FOIA) request regarding beef checkoff audit reports. The original 2014 complaint followed 18 months of attempts to get to the truth about an OIG beef checkoff audit that began in 2011.

OCM President Mike Weaver stated, “Just as NCBA is trying to hide the truth by attempting to intervene, recent press statements by NCBA are just baseless distortions of the truth.”

First, NCBA claims that two audits found them to be in full compliance with the laws that protect checkoff funds. There were never two audits of NCBA, as it has claimed. There were two audits, but AMS was the target of one, and NCBA was the target of the other.

OIG initially conducted an audit of the Beef Checkoff Program in 2013. When OCM filed a FOIA request, OIG withdrew the audit for further consideration, re-releasing it in 2014. The initial audit, which was withdrawn, contained a statement that NCBA was in full compliance; however, when it was subsequently re-released in 2014, that statement was specifically removed. Claims by NCBA that it was exonerated by the OIG audit are false.

NCBA makes no mention of a prior independent audit revealing its abuse of checkoff funds to the tune of over $200,000 after reviewing only a mere handful of transactions out of a total of thousands. That failure to trigger and pursue a full audit in the face of such obvious smoking-gun mismanagement of checkoff funds resulted in the FOIA request by OCM.

NCBA also claims there has been a return to “producers” of anywhere from $5.50 to $11.00, depending on a number of “studies” commissioned by NCBA. Clearly, in today’s concentrated-market environment, it is packers and retailers, not financially stressed family farmers and ranchers, who have benefited most from NCBA’s agenda. NCBA-financed studies are biased.

Current US cattle-producer numbers are nearly half what they were 20 years ago. The price of calves is less than half what it was just one year ago, and losses are the worst in 40 years. Even at the market highs of 2015, producers’ share of the retail price was $170 to $200 less than the retail market price in 1970.  Today, following the cattle market crash, the retail share for producers is $716 less than the producers’ 1970 retail share. With heavy concentration in the retail market and few buyers, producers are the ones being squeezed right out of business.  It is beef prices that have stayed relatively high–not cattle prices.

Through the advancement of their policies, NCBA has almost single handedly destroyed the cattle price.  NCBA lobbied to abolish COOL on behalf of packers so cheap imported South American beef could be co-mingled with U.S. beef.  NCBA appears to have supported USDA’s recent ruling to allow possible foot-and-mouth disease infected South American beef to be brought into our domestic markets. Unbiased observers need only look at what has happened to cattle prices here at home since those two events.

We have not seen evidence of NCBA’s justification for statements that an audit of its activities will weaken the checkoff. If anything, bringing the checkoff into the light should make it more stable and trustworthy. If NCBA believes an audit poses risk to the beef checkoff, then there must be many revelations to come.

These issues are unrelated to HSUS, other than the assistance it offered OCM to expose any mishandling of US beef checkoff dollars.

If it has nothing to hide, NCBA should finally, fully, and immediately withdraw its desperate efforts to conceal records and keep checkoff-paying producers in the dark.

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