By now you probably noticed Agriprocessors'…
…money troubles began long before the May 12, 2008 immigration raid.
For example, Sholom M. Rubashkin's bank fraud allegedly began at least 8 months before the raid.
What happened to cause Agriprocessors – which controlled 60% of the glatt kosher meat market in the US and 40% of the chicken before the raid – money troubles?
Several things come to mind:
The price of corn more than doubled and the wholesale price of chicken could not match that rise. At the same time, shipping and transportation costs exploded.
- The family's need to pay for the legal defense of Moshe Rubashkin and Moshe's son Sholom (the nephew of Agriprocessors' Sholom M. Rubashkin).
- The family's need to pay for the legal representation of Sholom M. Rubashkin and Agriprocessors during the Allou Healthcare bankruptcy fraud.
- The family's need to retain counsel due to the US Department of Justice's ongoing price fixing and collusion investigation.
- The family's decision to retain legal counsel and fight all the way to the Supreme Court in its bid to break the union at its Brooklyn warehouse. (Here's how the Rubashkins actually treat their workers.)
- Moshe Rubashkin's $450,000 fine payable before his plea was accepted by the court.
- The $1.7 million dollar judgment against Agriprocessors in the Allou Heathcare case.
All of those legal fees from numbers 2 through 7 add up to lots of money. Add in the money lost by lower profit margins on chicken and increased transportation costs and you have what could be a shortfall of many millions of dollars.
It seems Agriprocessors' response to this financial crisis of (mostly) their own making was bank fraud.