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Nebraska Beef agrees to $200K fine for misrepresenting grading records

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Nebraska Beef Ltd. has entered an agreement with federal prosecutors on allegations the company misrepresented beef grading records.

The Omaha meat processing company is pleading guilty and agreed to a $200,000 fine, according to the plea agreement filed in September in U.S. District Court in Omaha.

The case comes on the heels of cases filed against two former employees — Dolese Tippery, an accountant, and chief financial officer, James Timmerman — who both got probation and $1,000 fines earlier this year for making false representations of inspection and grading of agricultural products.

In the plea agreement in the new case, Assistant U.S. Attorney Donald Kleine said on June 3, 2016, Nebraska Beef was served with a grand jury subpoena and ordered to produce grading records for 30 carcasses of beef.

He said a corporate officer altered the grading records before providing them to the company's attorneys five days later, who in turn provided them to the U.S. Attorney's Office and the grand jury.

In Tippery's case, Kleine said on June 3, 2016, USDA Agricultural Market Service graders visited the company for an inspection and found at least 30 carcasses of beef ungradable and designated them No-Roll because of their age. But they later found the carcasses with what appeared to be USDA ink stamps designating them as Prime grade.

In Tippery's plea agreement, prosecutors said as early as 2012, boxes of beef processed at the main plant would be labeled initially with the correct grade, such as No-Roll and Select, then transported to an off-site warehouse, where employees "would remove original labels on the boxes of beef and replace them with higher-grade labels such as Choice and Prime. The relabeled product was then returned to the food-processing company and put into inventory."

Kleine said Timmerman altered the records and Tippery, knowing that the relabeling was occurring, created false internal records to conceal the scheme.

Joshua Weir, Nebraska Beef's attorney, said the law provides that a company must accept responsibility for the acts of its employees, even when the acts are contrary to the employer’s instructions or against the corporation’s policies.

He said a former employee has said he misreported industry information to the government in 2016.

"The former employee took this action unilaterally. The information was technical in nature and there was no economic or any other consequence of any type to any party. The negotiated agreement between the company and the government resolves all issues related to the case," Weir said. 

At sentencing in November, the company faces up to five years of probation in addition to the fine, the max on the charge.

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Reach the writer at 402-473-7237 or lpilger@journalstar.com.

On Twitter @LJSpilger

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Public safety reporter

Lori Pilger is a Norfolk native and University of Nebraska-Lincoln graduate who has been a public safety reporter for the Journal Star since 2005.

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