USDA takes heat as Democrats seek probe into trade aid

USDA takes heat as Democrats seek probe into trade aid
© Getty Images

The top watchdog at the United States Department of Agriculture (USDA) took heat Tuesday from Democrats who are demanding an internal probe into trade-related aid payments to the subsidiary of a Brazilian corporation under criminal investigation.

Democrats on a House Appropriations subcommittee urged USDA Inspector General (IG) Phyllis Fong to investigate whether the department should continue funding meatpacking company JBS USA with aid designed to support farmers hindered by President TrumpDonald John TrumpWinners and losers from the South Carolina debate Five takeaways from the Democratic debate Democrats duke it out in most negative debate so far MORE’s trade battles.

Fong declined to say whether her office would probe JBS USA’s parent company while it is being investigated by the Department of Justice and Securities and Exchange Commission, but noted that she is required to coordinate with federal law enforcement.


Fong’s answer did little to appease Democrats who have called on the USDA to take its own action after they were rebuffed by Agriculture Secretary Sonny PerdueGeorge (Sonny) Ervin PerdueOvernight Energy: Critics pile on Trump plan to roll back major environmental law | Pick for Interior No. 2 official confirmed | JPMorgan Chase to stop loans for fossil fuel drilling in the Arctic Pence visits Michigan in effort to solidify swing-state support White House will 'strictly' enforce China trade deal amid coronavirus outbreak MORE, who declined in January to investigate the company during the DOJ probe.

“I’m making an assumption that the Secretary condones the use of taxpayer dollars. In order to subsidize a corrupt foreign-owned corporation and engaged in illegal activity,” said Rep. Rosa DeLauroRosa Luisa DeLauroNew Social Security rule limits access to non-English speakers On The Money: Deficit spikes 25 percent through January | Mnuchin declines to say why Trump pulled Treasury nominee who oversaw Roger Stone case | Lawmakers trade insults over Trump budget cuts Lawmakers trade insults over Trump budget cuts MORE (D-Conn.), who asked USDA in a November letter to investigate and halt payments to JBS.

“You are independent. That's what makes the IG so critically important to all of us here.”

In a Jan. 31 response to DeLauro made public Tuesday, Perdue said the USDA “will not take any action” that could interfere with the DOJ and SEC investigations “unless requested” by those agencies.

Rep. Mark PocanMark William PocanDemocrats call on Pompeo to restore funding to Gaza USDA takes heat as Democrats seek probe into trade aid 2020 Democratic hopefuls focus on Iowa while making final pitches MORE (D-Wis.) bemoaned the fact that JBS USA received more aid than all of Wisconsin’s dairy farmers as his state reels from a string of farm bankruptcies.


“I think they deserve some bigger answers,” Pocan said. “If we could do that in the Inspector General report I know it would be appreciated.”

JBS USA, the second-largest U.S. meat processing company, has received roughly $67 million in USDA grants intended to go to pork farmers who lost sales to China and Europe due to response to Trump’s tariffs. But the payments to JBS USA have provoked bipartisan backlash over the company’s foreign ownership and connections to a Brazilian bribery scandal.

JBS USA is the American subsidiary of JBS S.A., a Brazilian meat conglomerate owned by brothers Joesely and Wesely Batista. The Batistas admitted to spending roughly $150 million to bribe more than 1,800 Brazilian government officials to secure $1.3 billion in loans from the Brazilian Development Bank (BNDES) and federal pension funds. 

The DOJ and SEC are investigating whether JBS S.A. violated federal anti-corruption laws and financial disclosure laws by using illegally obtained domestic grants to expand into the U.S. meat industry.

Sens. Bob MenendezRobert (Bob) MenendezMenendez calls for 'Marie Yovanovitch bill' to protect foreign service employees Senators condemn UN 'blacklisting' of US companies in Israeli settlements Media's selective outrage exposed in McSally-Raju kerfuffle MORE (D-N.J.) and Marco RubioMarco Antonio RubioOvernight Energy: Critics pile on Trump plan to roll back major environmental law | Pick for Interior No. 2 official confirmed | JPMorgan Chase to stop loans for fossil fuel drilling in the Arctic MacGregor confirmed as Interior deputy chief GOP casts Sanders as 2020 boogeyman MORE (R-Fla.) also asked Treasury Secretary Steven MnuchinSteven Terner MnuchinFinancial trade tax gains traction with 2020 Democrats Hillicon Valley: Agencies play catch-up over TikTok security concerns | Senate Dems seek sanctions on Russia over new election meddling | Pentagon unveils AI principles Senate Democrats urge Trump administration to impose sanctions on Russia for election interference MORE to conduct an investigation into JBS through the Committee on Foreign Investment in the U.S., a secretive Treasury panel with expansive power over foreign business operations in the U.S.

JBS USA spokesman Cameron Bruett said in a statement at the time that the company "has fully cooperated with all relevant authorities in a transparent manner regarding past events in Brazil."

"The company will continue to cooperate and respond to any subsequent inquiries," Bruett said.