A U.S. Department of Agriculture inspector testified Wednesday that William Aossey, Jr. admitted to changing labels and stamps on halal beef products in order to ship them to Malaysia and Indonesia.
Jeff Griess, said Aossey knew the establishment number belonging to PM Beef in Windom, Minn., was changed on products to reflect a number belonging to J.F. O’Neill Packing Co. in Omaha, Neb., because O’Neill was only one of two or three beef suppliers who were approved to export halal beef to Malaysia and Indonesia during 2007-2010.
Griess also said Aossey signed a written statement saying he took full responsibility and admitted to telling employees to change the numbers and labels. Griess performed the Midamar inspection and found the illegal activity in February 2010.
Aossey, 73, the founder of Midamar, is charged with 19 counts relating to an alleged halal beef export scheme. He is charged with one count of conspiracy to make false statements, sell misbranded meat, and commit mail and wire fraud; seven counts of making or causing false statements to be made on export applications; seven counts of wire fraud; three counts of money laundering; and one count of conspiracy to commit money laundering.
The prosecution continues its case 9 a.m. Thursday in U.S. District Court. The trial, which started Tuesday, is expected to last a week.
Griess said the misbranding and mislabeling had been going on for about three years after he looked at Midamar’s shipping records. Midamar, or any other company, isn’t allowed to change establishment numbers, he said. Assistant U.S. Attorney Richard Murphy asked what kind of impact this mislabeling could have on the export business.
Griess said it could financially impact producers and processors because the foreign countries who have requirements could refuse to take U.S. beef if they found out this was happening.
In other testimony, two employees from PM and O’Neill testified about the establishment numbers on their products and former Midamar employees testified that the scheme to skirt strict slaughtering requirements was common knowledge in the warehouse.
Lisa Hernandez, vice president of operations for PM Beef, testified the company puts its establishment number on all the Cryovac or vacuum sealed packaging and on the box labels.
“Nothing goes out the door without the establishment number,” Hernandez said.
She added that PM would never give Midamar permission to use another establishment number on their products.
Debra Bailey, officer manager with J.F. O’Neill, testified the company was authorized to export to the two countries in 2007-2010 but had only supplied meat to Midamar up to July 11, 2007 and then not again until 2010.
Bailey also said it would be “illegal” if O’Neill let another company use its establishment number.
Debra Lapsey, former Midamar employee who prepared documentation for overseas shipments, said she was asked to change the numbers by a salesperson and William Aossey. She also was asked to inflate the price on a product that went bad so Midamar could collect more insurance money.
Lapsey testified that Aossey yelled and screamed at her when she refused. She was eventually fired.
Virginia Birdnow, a warehouse supervisor, said she directed employees to change establishment numbers and had employees use acetone and paper towels to wipe off numbers on Cryovac packaging. They would also remove box labels from PM and replace them with Midamar labels.
Birdnow said Aossey came into the warehouse to ensure they were removing the labels or stamps correctly.
On cross examination, Birdnow admitted she was fired and filed a unemployment claim but lost. She admitted she was mad about being denied but “got over it.”
Darrin O’Brien, who formerly worked in accounts management and sales at Midamar, said the export certificates for the halal products were also altered to reflect they came from O’Neill, instead of PM. He added the invoices kept at Midamar showed the actual supplier to be PM.