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Beef exporters plead guilty to halal fraud

Beef exporters plead guilty to halal fraud

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CEDAR RAPIDS, Iowa (AP) — Two related companies that distribute and certify halal food products pleaded guilty Wednesday to conspiring to export misbranded beef products for sale in Malaysia, Indonesia and elsewhere.

Midamar Corp. and Islamic Services of America each entered guilty pleas in federal court in Cedar Rapids to one count of conspiracy to make false statements on export certificates, sell misbranded meat and commit wire fraud, among other offenses.

Under the plea agreement, each company must forfeit $600,000 in proceeds derived from the scheme. They could also face a term of probation and an additional fine at sentencing.

U.S. District Judge Linda Reade has rejected the companies’ claims that the charges were regulatory violations that should have been handled by the U.S. Department of Agriculture, ruling that federal prosecutors didn’t overstep their jurisdiction in bringing the case. However, despite the guilty pleas, the companies can appeal Reade’s decision.

Midamar is a food distributor, while ISA certifies Midamar and other companies’ food products as halal and is one of the few organizations approved to certify beef for import into Malaysia, Indonesia, Kuwait, Saudi Arabia and United Arab Emirates. Both were founded and operated by the Aossey family in Cedar Rapids.

Midamar issued a statement last week saying that the plea agreements resolve all charges against the companies and executives. Midamar said it has now “taken full responsibility for wrongful conduct” that occurred from 2007 through 2012 and apologized for errors in judgment.

Midamar’s founder, Bill Aossey Jr., was convicted in July of falsifying documents as part of a scheme to export beef to Malaysia and Indonesia that didn’t meet those countries’ strict standards of religious-based slaughter. He’s in federal custody awaiting sentencing and could face several years in prison; he has asked for a new trial.

Copyright 2015 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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