From the 2011 Cattle Industry Convention- John Queen Dissects the Eastern Livestock BankruptcyFri, 04 Feb 2011 17:19:37 CST
Cattle producers and markets that were impacted by the Eastern Livestock bankruptcy are now focused on working with the Trustee to recover as much of their losses as possible. Three individuals whose companies have money tied up in the Eastern debacle were on a panel at the Cattle Industry Convention in Denver on Friday afternoon. One of the three is a past President of the National Cattlemen's Beef Association- and Norh Carolina cattle producer and video auction operator John Queen acknowledges that the money tied up with Eastern may mean his family will have to liquidate some of their farm to cover the deficit. Click here for Queen's Livestock Auction Market- Southeast Livestock.
Queen says that the entire cattle industry has been failed by the lack of action by the USDA's GIPSA- the agency responsible for following the business conducted by Eastern Livestock. Queen says that GIPSA has audited his relatively small business three times over the last two years, but has reluctantly admitted they had not audited Eastern Livestock since at least 2005. He adds that if GIPSA was not competent enough to perform an audit on the nation's largest livestock dealer- they should have hired an outside independent company to perform an audit at some point along the way.
Queen adds that Eastern Livestock's bank, Fifth Third, did not do their homework as to the amount of business that Eastern claimed they were doing in the final year before checks started bouncing this past October. Eastern claimed they had tripled their business in 2009 and early 2010 compared to just a few months earlier, which earned them a larger line of credit which they quickly utilized. Queen says that Eastern was claiming to Fifth Third that their volume of cattle transactions were greater than the entire universe of cattle trades within the US. Queen contends that Fifth Third carefully chose their time to stop honoring the checks written by Eastern- choosing to stop honoring those checks at the peak of the fall cattle run, when Eastern would have a maximum amount of money running through their account.
After the session at the Live Cattle Marketing Committee on Friday- Ron Hays and Stewart Doan talked with John Queen about his views on the Eastern Bankruptcy- and what it has done to his business.
Click on the LISTEN BAR to hear the full conversation.
Ron Hays and Stewart Doan talk with former NCBA President John Queen about Eastern Livestock and how the system failed cattle producers.
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