Executive arranged bribes, falsified information
By MATEUSZ PERKOWSKI
A former California food company executive has pleaded guilty to engaging in a criminal scheme related to sales of tomato paste and other products.
Frederick Scott Salyer, 56, has agreed to serve between four and seven years in prison as part of a plea deal with the federal government.
The actual sentence will be determined by a federal judge on July 10.
Salyer has admitted to racketeering and price-fixing while serving as the CEO of SK Foods, a large California grower, processor and marketer of tomatoes and other vegetables.
The maximum sentence is 20 years in prison and a $250,000 fine for racketeering and 10 years in prison and a $1 million fine for price-fixing.
According to the plea deal, entered March 23, Salyer arranged for a sales agent to pay bribes to food buyers at several major companies, including Frito-Lay, Kraft and B&G Foods.
In exchange for payments, the food buyers were expected to promote SK Foods' products "at the expense of the interests of their employers," according to the plea deal.
For example, in 2007 the buyer for B&G Foods agreed to pay a higher price for chili and jalapeno peppers from SK Foods in exchange for a kickback fee of half a cent per pound.
Salyer admitted that he directed workers at SK Foods to falsify information about the attributes of tomato paste, so that the product would appear to meet customer specifications.
The company also engaged in illegal "restraint of trade" by conspiring to fix the price of tomato paste, with Salyer convincing a competitor to withdraw a bid that undercut that price, according to the plea deal.
As part of the plea agreement, the federal government has agreed not to seek more than seven years in prison.
The government also dropped 10 other criminal counts for which Salyer was initially indicted, including wire fraud, destroying records in a federal investigation and additional instances of racketeering and restraint of trade.
Salyer has agreed not to ask for fewer than four years in prison and to turn over to the federal government more than $3 million he had deposited in foreign bank accounts.
The plea deal does not cover the amount of fines and restitution to victims that Salyer may have to pay, as he did not reach an agreement with the government on those points.