The U.S. Department of Agriculture (USDA) has imposed sanctions on Southern Produce Distributors Inc. (SPD), Faison, NC, for violating the Perishable Agricultural Commodities Act (PACA). These sanctions include barring the business/principal operators from engaging in PACA-licensed business/other activities without approval from USDA.
SPD failed to pay $3,488,367 to 33 sellers for produce that was purchased, received and accepted in interstate and foreign commerce from April 2017 to June 2018. SPD cannot operate in the produce industry until June 25, 2023, and then only after they apply for and are issued a new PACA license by USDA.
The company’s principal, Kelley Precythe, may not be employed by/affiliated with any PACA licensee until June 25, 2022, and then only with the posting of a USDA approved surety bond. The company’s other principal, Sterling Cook, has challenged his responsibly connected status.
The USDA has also imposed sanctions on four produce businesses for failing to meet contractual obligations to the sellers of produce they purchased and failing to pay reparation awards issued under PACA.
The following businesses/individuals are currently restricted from operating in the produce industry:
- Stephan Eckel, Paniolo Produce of Winchester, CA, for failing to pay $108,340 in favor of a Missouri seller. Eckel was listed as sole proprietor.
- Alko Green Fresh LLC of Las Vegas, NV for failing to pay $19,900 in favor of an Illinois seller. Jorge Ortega was listed as manager and member.
- Ayar Produce NY Inc. of Brooklyn, NY for failing to pay $45,089 in favor of a Texas seller. Necati Ayar was listed as the officer, director and major stockholder.
- Island Fresh of Puerto Rico of Bayamon, PR for failing to pay $48,847 in favor of a Florida seller. Jorge Mayendia was listed as the officer, director and major stockholder.
The USDA has also filed an administrative complaint against Ringer & Son Brokerage Co. Inc. for alleged violations of PACA. The company, operating from Colorado, allegedly failed to make payment promptly to nine produce sellers in the amount of $278,943 from May 2019-December 2019. Ringer & Son Brokerage Co. Inc. will have an opportunity to request a hearing.
The USDA also announced that Family Fruit 2 Inc. satisfied a reparation order in the amount of $47,025 issued under PACA involving unpaid produce transactions.
The Staten Island, NY, company met its obligations and is free to operate in the produce industry. Louis Epifania was listed as the officer, director and/or major stockholders of the business and may now be employed by or affiliated with any PACA licensee.
Click here for an overview of companies who previously violated PACA.