AMS No. 208-12
Nadine Wilkins (202)720-8998 Nadine.wilkins@ams.usda.gov
WASHINGTON, Sept. 25, 2012 – The U.S. Department of Agriculture (USDA) has imposed sanctions on two produce businesses for failure to pay reparation awards issued under the Perishable Agricultural Commodities Act (PACA).
The following businesses and individuals are currently restricted from operating in the produce industry:
--Al Costo Inc., operating out of Santa Maria, Calif., for failing to pay a $13,439 award in favor of a California seller. As of the issuance date of the reparation order, Jose L. Carmona, Victor M. Sanchez, Francisco J. Sanchez, and Graciela Sanchez were listed as the officers, directors, and major stockholders of the business.
--Yippikya Corp., operating out of Houston, Texas, for failing to pay a $9,786 award in favor of a Massachusetts seller. As of the issuance date of the reparation order, Katherine E. Schneider was listed as the officer, director, and major stockholder of the business.
PACA provides for an administrative forum to handle disputes involving produce transactions; this may result in a reparation order being issued that requires damages to be paid by those not meeting their contractual obligations in buying and selling fresh and frozen fruits and vegetables. The USDA is required to suspend the license of a business that fails to pay PACA reparations awarded against it as well as impose restrictions against those principals determined to be responsibly connected to the business when the order is issued. Those individuals, including sole proprietors, partners, members, managers, officers, directors, or major stockholders, may not be employed by or affiliated with any PACA licensee without USDA-approval.
The Agricultural Marketing Service (AMS), PACA Division, regulates fair trading practices of produce businesses operating subject to the PACA, which includes buyers, sellers, commission merchants, dealers, and brokers, within the fruit and vegetable industry. All oversight of actions related to the PACA are conducted by the AMS, an agency within the USDA.
In fiscal year 2011, USDA resolved approximately 2,000 claims filed under the PACA involving $31 million. This is just one more way the USDA continues to support the fruit and vegetable industry.
For more information, contact John Koller, Chief, Dispute Resolution Branch at (202) 720-2890, by fax at (202) 690-2815, or by email at disputeresolutionsection@ams.usda.gov regarding this matter.
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