GIPSA investigating Eastern Livestock Co.

Investigators with the Grain Inspection, Packers and Stockyards Administration (GIPSA) are looking into unpaid livestock transactions at Eastern Livestock Company at New Albany, Indiana.

“There appears to be a significant amount that is owed for cattle to sellers in several states,” said Jay Johnson who serves as the Regional Director of the GIPSA Midwest Regional office in Des Moines. “The amount, unpaid, likely exceeds $90 million.”

According to Mark Mackey, CEO of the Livestock Marketing Association (LMA), Eastern Livestock is one of the largest feeder cattle brokerages in the U.S. operating in all 48 contiguous states.

For those livestock farmers doing business with Eastern Livestock, Mackey tells Brownfield it’s a complicated situation.

“You want to make certain that you work with an attorney or someone in the profession to sort this matter out because it’s a complex situation,” Mackey said.

AUDIO: Mark Mackey, CEO, Livestock Marketing Assn. (3:45 MP3)


© Copyright Brownfield, All rights Reserved. Written For: Brownfield

Comments

  1. Will says:

    I am a Banker with 30 years of banking experience and Cattleman from a rural area. First I would like to respond to Black Sheep’s comment about Eastern oweing 32.5 million and the Bank would come out ahead with 67.5 million. Banks can only keep what is owed to them on a deal such as this. If Eastern is involved in Banruptcy or Court Litigation the bank will have to send the money to a trustee.If they are not in litigation the BANK MUST REFUNDED ALL MONIES BACK to the BORROWER.

    2nd Instead of Blaming Eastern and the Bank for shutting down the Line of Credit. You need to know why the Bank shut the LOC down. The Bank regulators might have benn the culprit.Until we know all the facts we won’t know who to blame.

  2. whats next says:

    I’ve got family who own and operate trucks that were leased to eastern and when they deposited their checks in the bank they garnished em and so far they recieved a call to bring in their trailers the bank seized them an no word yet oh what to do next so i’m wondering how are they gonna pay their drivers their telling everyone to contact gipsa on info for grants for farmers but noone can tell us how to get paid for what they lost so whats the next step? if any.

  3. Shannon says:

    I am a daughter to one of the buyers for Eastern. And before anyone accuses Eastern of being rustlers or what have you, please realize they are just as baffled as the rest of you. They are trying to get to the bottom of this as quickly as possible. Before anyone points fingers…please respect that they are trying to get to all the facts and understand what is going on first. I know one thing, my father has always gone above and beyond to help out the farmers…he is one too! Remember, the owners and buyers are all from a farming background…they would never want to see the farming communities go under! Without the farmers, what good is Eastern? They would never try to deliberately do this to the farmers. My father is completely in shock and many are not responding only because they are just as confused as everyone else. They are trying to figure out what happened with Fifth Third, what happened period. They just have a lot of questions right now. I am only speaking on my behalf and what I do know about my Dad and the company. If they are trying to skim money, then you would think my family would be living the high life? I work a full time job like everyone else, not driving a brand new car or living in luxury. My father doesnt either. He is always one to give and doesnt care about possessions. I can only give one side of the story and truly hope everyone on both sides can work together to work this out. Im praying every night that God can help figure this out soon. The farmers need to stick together through this. I dont want to blame the bank…I can just see how one mistake couldve led to such a dilemma as this! How did the bank not see this coming way before it happened and some how warn Eastern??? That is why Im confused? With such a big account like Eastern…it shouldve never gotten so far out of hand without 5th Third warning Eastern. Im not familiar with their side, but I just have questions. I just pray they can all work it out fairly and righteous, possibly make a good story come out of a bad one. God bless to all.

  4. Black Sheep says:

    I just read on another web sight that Eastern owes Fifth Third Bank of Cincinnati 32.5 million. We all know that that if there checks outstanding to producers= 90 million, that the cattle had to be re marketed for at least the same if not more and most of the cattle was probably already pre sold prior to purchasing it from producers. Now do the math, 90 million in cattle sold at zero profit = 90 million. Bank is owed 32.5 million. Eastern sells cattle, The bank seizes assets (including income) from Eastern worth a minimum of 90 million in cattle alone, and comes out 67.5 million ahead of the game. How is that for justice. As Hank Williams Jr. sang many years ago, The banker is against farmer, and the farmer’s against the wall.

  5. Black Sheep says:

    . As i read all of this I was thinking the same thing as Brandon Batcher. The bank (Fifth Third Bank of Cincinnati), and the banks investors are the ones that should be held accountable. For 1) They must have known for some time that they were gonna cut off Eastern’s line of credit, 2) they now have frozen Eastern’s assets, are collecting all of the sales checks that Eastern may have coming in, and have returned all of the checks to the producers, truckers and various other creditors to Eastern. In the end, Eastern will have egg on its face and the bank will get the collateral, and the producers/creditors will suffer the loss. This will be all done legally. The banks always have been and always will be the winner.

  6. Brandon Bratcher says:

    Eastern has done nothing wrong. They operate no differnt than anyone else. Does no one get it? So GIPSA forces the bank to call thier note at the height of buying season??? They weren’t writing bad checks, they were working on a line of credit to speak. What do you think this will do to the cattle market, especially east of the Miss River? There will be a ripple thru the industry which GIPSA hopes will drum up support for its proposal. There is more than meets the eye here.

  7. G W Campbell says:

    I am a small producer and have lost thousands like the rest, when is usda going to steep in and do somthing about these cattle ruslers

  8. Dave Fischer says:

    Anyone know how this will effect local livestock auction yards such as Producers? It seems if they got bad checks from Eastern and they already paid the farmers who brought in calves, Producers will be left holding the bad checks. I am afraid to take cattle to an auction yard. In our area of Southern Indiana, Eastern was buying a high percentage of the calves at all 3 surrounding auctions that are all owned and run by Producers. Producers had their financial bankruptcy last year, will it happen again?

  9. scotty says:

    another example of the failing econmy and the big boys trying to hog it all

  10. Troy Latham says:

    We are from Central Texas we shipped three loads of cattle our check bounced for the second time November 8th. The cattle was shipped October 20th the check was dated Oct 24th did not receive the check until October 29,
    We have a neighbor that shipped 10 loads and another neighbor that shipped one. Do the math, this is around 780,000. We are all small producers, and have no recourse, the cattle were immediately resold after leaving our possession.

  11. F D Fields says:

    These guys have appearantly filed for bankruptcy and left a lot of my neighbors holding the bag. Some have lost as much as $14,000 plus. They sold their cattle on Tuesday and were told the checks were no good on Thursday!

    This smells like four day old fish!

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