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FOR IMMEDIATE RELEASE

December 29, 1997

 

PRESS RELEASE

 

Donald C. Smaltz, Independent Counsel In re Espy, announced:

   Today, Tyson Foods, Inc., the world's largest fully-integrated producer, processor, and marketer of poultry-based food products, and a New York Stock Exchange company, pleaded guilty to giving former Secretary of Agriculture Alphonso Michael Espy over $12,000 in gratuities and agreed to pay $6,000,000 in fines and investigative expenses. The one-count Criminal Information charged that Tyson Foods gave four gratuities to Espy during 1993 and 1994 while Tyson had a number of matters pending before the Department of Agriculture, including among other things, an emergency interim final rule issued on or about August 16, 1993, by the USDA that required processors, including Tyson Foods, to place safe handling instructions on all raw meat and poultry packaging labels.

   The Court -- Judge Ricardo M. Urbina -- accepted Tyson Foods' plea of guilty, which was entered by Don Tyson, Senior Chairman of Tyson Foods' Board of Directors. Under the terms of a plea agreement between Tyson Foods and the government, Tyson Foods agreed to pay a $4 million fine and $2 million in investigative costs. The Court deferred imposition of sentence until January 14, 1998 at 11:15 a.m. and ordered the Probation Department to conduct a pre-sentence investigation. On January 14, 1998, the Court will determine whether or not to accept and impose the terms of the plea agreement.

    Mr. Smaltz stated:

    The gravamen of this investigation from its inception, has been unlawful gift-giving by prohibited corporate sources to a sitting member of the Cabinet. Such conduct must continue to invite outrage, never passivity, from those who are regulated, the public, and our lawmakers. Tyson continued its practice of unlawfully giving gratuities to Espy until it was first exposed by the press in March 1994. The criminal and civil laws and USDA regulations have long prohibited regulators from accepting, and the regulated from giving, things of value. Our government is a government of all the people and not just the privileged few who seek to buy their way into regulatory grace.

   The unlawful gratuities Tyson Foods gave Espy were given for or because of official acts Espy performed or would perform, in violation of 18 U.S.C. 201(c)(1)(A) and consisted of:

    1. Four tickets to the January 18, 1993 Presidential Inaugural Dinner for a total cost of $6,000;

    2. On May 14-16, 1993, air transportation (round trip for Secretary Espy's girlfriend and one way for Secretary Espy) on a Tyson Foods jet, meals, lodging, and entertainment at the Don Tyson/John Tyson Birthday Party, Tyson Management Development Center, Russellville, Arkansas, in the approximate amount of $2,556;

    3. On or about January 4, 1994, a Tyson Foundation scholarship check for Secretary Espy's girlfriend in the amount of $1,200 for the first semester of an eight semester program; and

    4. Airline tickets for Secretary Espy's girlfriend, skybox tickets, food, and limousines for the Dallas Cowboys--Green Bay Packers January 16, 1994 playoff game in the approximate amount of $2,271.

   The plea agreement also requires that Tyson Foods enter into a Compliance Agreement which sets out certain additional procedures Tyson Foods is required to implement including: the establishment of an Ethics Compliance Committee; implementing a Corporate Code of Conduct and Compliance Policy; appointing a new chairman of the Audit Committee of the Board of Directors; and requiring that the Audit Committee review the expenses for the corporate officers and contracts of all lobbyists or consultants. In addition, Tyson Foods would also be required to prepare quarterly ethics compliance reports setting forth the steps it has taken to comply with the Compliance Agreement.

   Under the terms of the plea agreement, Tyson Foods' $6,000,000 payment would be comprised of a $4,000,000 criminal fine for giving illegal gratuities to Secretary of Agriculture Espy and a $2,000,000 reimbursement toward the costs of the Office of Independent Counsel's criminal investigation.

   A copy of the Criminal Information, Plea Agreement and Compliance Agreement are available from the Office of Independent Counsel upon request.

    Former Secretary of Agriculture Alphonso Michael Espy was charged in a 39 count indictment filed on August 27, 1997. The trial is currently scheduled to commence on March 30, 1998, before The Honorable Ricardo M. Urbina, the judge who presided over Tyson's plea of guilty, and who will impose sentence. The trial of Tyson Foods' lobbyist, Jack Williams, is currently set for trial on February 2, 1998 before The Honorable James Robertson.

    The Independent Counsel's investigation is continuing.

 

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