Iowa kosher slaughterhouse clients testify they refused to pay bills lacking proof of delivery

Companies refused payment to kosher slaughterhouse

SIOUX FALLS, S.D. — A former kosher slaughterhouse manager accused of defrauding a bank had the final say on financial reports, a former chief financial officer testified Monday.

Mitchell Meltzer said the manager, Sholom Rubashkin, allowed him to shift expenses to hide purchases from St. Louis-based First Bank.

Rubashkin, faces 91 fraud charges in the federal trial, including mail, wire and bank fraud. Prosecutors claim Agriprocessors Inc. intentionally defrauded First Bank on a revolving $35 million loan by faking invoices from meat dealers.

The Agriprocessors plant in Postville, Iowa, was the site of a major immigration raid in May 2008, when 389 illegal immigrants were arrested. After the raid, First Bank sent Agriprocessors about $3.45 million to keep the plant afloat.

“Sometimes he would offer changes, and they made them,” Meltzer said. “He usually wanted more income.”

Meltzer said he and four other employees received parts of their salaries in cash to avoid taxes. He also said that he and former Agriprocessors controller Toby Bensasson created false invoices that they referred to as “tootsies.”

Allegations of false invoices are critical to the prosecution’s case against Rubashkin. Prosecutors allege he created the invoices to show First Bank had incoming money.

Rubashkin defense attorney F. Montgomery Brown questioned Meltzer’s credibility, alleging Meltzer stole from the plant and lied on a social-networking Web site about his job experience. Meltzer said he cashed checks as a favor to Rubashkin, and Brown responded by saying Meltzer “fleeced the company.”

The trial was moved from Iowa to South Dakota because of pretrial publicity. Monday’s testimony began the third week of the trial.

On Monday morning, financial officers from companies that bought meat from Agriprocessors testified that bills from the plant didn’t match their own records and so the companies refused to pay them.

Albert Barel of Los Angeles-based City Glatt testified that a government-appointed trustee of Agriprocessors was unable to show proof of delivery on bills from 2007 and 2008.

“We saw there were a lot of invoices not in our records, so we did not pay,” Barel said.

Brown questioned City Glatt’s record keeping.

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Information from: Waterloo-Cedar Falls Courier, www.wcfcourier.com