…the Gazette reports:
Lender forecloses on Agriprocessors
By Dave DeWitte
CEDAR RAPIDS - A major lender has foreclosed on Agriprocessors and its owners, asking that a receiver be appointed to take control of the embattled kosher meat supplier.
The action Thursday by First Bank Business Capital of St. Louis seeks to foreclose on $33.5 million in loans.
Agriprocessors was the nation's largest kosher beef processor until an immigration raid last summer resulted in the detention of much of its work force. It has since faced a stinging series of legal charges over issues ranging from use of child labor to violations of wage laws.
First Bank asks the company to be placed in the hands of a receiver, Atec Liquidation of St. Louis.
In support of the request, the bank says the borrowers "have repeatedly made misrepresentations to First Bank by providing inaccurate and misleading notices of borrowing and other documents that misstated the value of the collateral."
It said officers of Agriprocessors have admitted to diverting funds constituting First Bank's collateral to an account they maintained at Luana Savings Bank in Luana.
It says the bank notified the company, and owners Aaron Rubashkin and Sholom Rubashkin on Wednesday that the company is in default.
Agriprocessors spokesman Chaim Abrahams said Friday afternoon declined to comment on the foreclosure, saying the company's owners are still analyzing it.
The foreclosure calls into question the continued operation of Agriprocessors by the founding Rubashkin family. Owners Abraham Rubashkin and Sholom Rubashkin are individually named in the lawsuit as officers of the company who signed personal guarantees of some of the loans.
A hearing on the request for a receiver was scheduled this afternoon in U.S. District Court in Cedar Rapids.
[Hat Tip: state of the Jews.]