U.S. District Court Chief Judge Linda R. Reade has ordered that the Iowa meatpacking manager found guilty on 86 counts of fraud and money laundering will remain behind bars.

Sholom M. Rubashkin, who served as the day-to-day manager at Agriprocessors in Postville and is the son of company founder A. Aaron Rubashkin, will remain in the custody of U.S. Marshals until he is sentenced on the earlier conviction. It is unknown if Rubashkin, who recently had 72 immigration-related offenses against him dismissed, will remain in a county facility or will be moved to a federal prison. An exact sentencing date has not yet been established, and, since the process requires extensive reports for judicial review, the date could be several weeks from now.

In the bail hearing on Wednesday, the Rubashkin defense team pointed to the man’s strong community and family ties in Postville as well as his record of good behavior while on release pending trial. Prosecutors, on the other hand, told the court that the fact that Rubashkin was facing a sentence of possibly several hundred years in prison that the situation had changed significantly.

In addition, the prosecution called Mike Fischels, a special agent who has long been assigned to the Agriprocessors case, to testify about an overseas telephone conversation he had with a company supervisor still wanted by the government.

Fischels testified that he spoke with co-defendant Hosam Amara on the telephone about Amara’s flight from the U.S. to Israel. Amara indicated to Fischels that [Rubashkin] told him to leave the U.S. and return to Israel in order to remove himself from the situation facing Agriprocessors.

The government also presented a copy of a check and bank documents that suggest Rubashkin provided financial assistance to Amara around the time that he fled the U.S.

The court finds that the government’s evidence for detention is compelling.
Defendant’s actions prior to and during the pendency of the instant action, when coupled with the powerful incentive to flee due to the jury’s return of the Verdicts, demonstrates that Defendant poses a flight risk. The court notes that, in the Detention Order, it previously found that Defendant posed a flight risk.

The court acknowledges the overwhelming support that Defendant’s community has provided during the trial and the instant proceeding. The court also recognizes that Defendant took great pains to comply with the terms of his pretrial release. The court agrees that Defendant has shown he is committed to his family and to his community. Nevertheless, the court finds that this evidence does not rise to the “clear and convincing” level necessary to show that he is “not likely to flee [. . .] if released under [§] 3142(b) or(c).” 18 U.S.C. § 3143(a). Accordingly, the court shall grant the Motion.

Rubashkin’s defense team has pledged to appeal the fraud and money laundering convictions. It is unknown at this time, however, if they will also appeal this detention order.

The modified indictment, which was filed today in federal court in Cedar Rapids, specifies that the Agriprocessors, Inc. corporate name, trademarks and corporate stock are subject to forfeiture. The trademarks would include such well-known brands as Iowa Best Beef, Shor Habor, Aaron’s Best and Rubashkin.

Sholom M. Rubashkin, son of company founder A. Aaron Rubashkin and a former chief executive at the Postville plant, remains in federal custody pending trial in this case and others. He is charged with various immigration and bank fraud-related charges.

Brent Beebe, Hosam Amara, and Zeev Levi, all former members of plant management, also face immigration-related charges. Amara and Levi fled the jurisdiction after a May 12 immigration raid at the plant and are currently been sought by Immigration and Customs Enforcement.

Human resources employee Karina Pilar Freund signed a plea agreement yesterday while admitting to one misdemeanor count of aiding and abetting a pattern or practice of hiring undocumented aliens. The charges she previously faced as a part of the November indictment have been dropped.

Federal authorities allege in the complaint that the company name, trademark and stocks were proceeds of the believed offenses of harboring undocumented aliens for profit and conspiracy to harbor undocumented aliens for profit. In addition, the modified complaint also seeks the forfeiture of all property used to facilitate the alleged offenses.

Agriprocessors has filed for Chapter 11 bankruptcy. It is unclear how this move by the U.S. Attorney’s Office for the Northern District of Iowa will affect the bankruptcy or the claims of numerous creditors. In addition, the plant in Postville, which briefly ceased production following Sholom Rubashkin’s arrest and detention, has resumed limited poultry production as bankruptcy trustee Joseph Sarachek negotiates with potential buyers. It is not publicly known if Sarachek’s negotiations have involved the facilities, corporate name and trademarks the government is seeking.

Hosam Amara, left, and Zeev Levi are former members of the management team at Agriprocessors. Both men are believed to have fled the jurisdiction following the massive May 12 immigration raid at the plant and are wanted by federal authorities. They are two of the five members of management indicted by grand jury.

The U.S. Attorney’s Office for the Northern District of Iowa unsealed new charges against Agriprocessors and five members of the meatpacking company’s management team today. The charges, ranging from immigration-related offenses to bank fraud, are included in a 12-count indictment.

Members of management named in the indictment are former Agriprocessors Chief Executive Sholom M. Rubashkin, 49; plant Operations Manager Brent Beebe, 51; former plant Poultry Manager Hosam Amara, 44; former plant Poultry Manager Zeev Levi; and former plant human resources employee Karina Freund, 29.

Charges from the indictment are as follows:

• Agriprocessors, Inc. — conspiracy to harbor undocumented aliens for profit, harboring undocumented aliens for profit, conspiracy to commit document fraud, aiding and abetting document fraud, six counts of aiding and abetting aggravated identity theft, and two counts of bank fraud
• Rubashkin — conspiracy to harbor undocumented aliens for profit, harboring undocumented aliens for profit, conspiracy to commit document fraud, aiding and abetting document fraud, six counts of aiding and abetting aggravated identity theft, and two counts of bank fraud
• Beebe — conspiracy to harbor undocumented aliens for profit, harboring undocumented aliens for profit, conspiracy to commit document fraud, aiding and abetting document fraud, and six counts of aiding and abetting aggravated identity theft
• Amara — conspiracy to harbor undocumented aliens for profit, harboring undocumented aliens for profit, conspiracy to commit document fraud, and aiding and abetting document fraud
• Levi — conspiracy to harbor undocumented aliens for profit, harboring undocumented aliens for profit, conspiracy to commit document fraud, and aiding and abetting document fraud
• Freund — conspiracy to harbor undocumented aliens for profit and harboring undocumented aliens for profit (The harboring charge is restated from a prior indictment, but the conspiracy to harbor charge is new.)

Beebe was arrested without incident at approximately noon at the Agriprocessors plant in Postville by Immigration and Customs Enforcement agents and the U.S. Marshals Service. He is slated to appear this afternoon in federal court in Cedar Rapids for an initial appearance and arraignment.

Rubashkin, who learned yesterday that he would remain in federal custody until trial on a different charge, is already being held in the Dubuque County Jail. Freund was released on conditions including electronic monitoring.

Federal authorities continue to search for Amara and Levi, both believed to have fled the jurisdiction shortly after the massive May 12 immigration raid at the kosher meatpacking plant. Iowa Independent was the first news outlet to report that Amara was believed to have fled. Those with information regarding Amara’s or Levi’s whereabouts are encouraged to contact ICE at (866) 347-2423.

Arraignments for Agriprocessors, Rubashkin and Freund have been scheduled for Nov. 26. In addition, Rubashkin and Freund already had a trial on other charges related to Agriprocessors slated for Jan. 20, 2009.

The Indictment

The week prior to the immigration raid, according to court documents, then Agriprocessors CEO Rubashkin loaned $4,500 to employees known to have fraudulent identification documents. Allegedly, Beebe then gave the money to the undocumented employees so that they could purchase new fraudulent alien resident cards. An Agriprocessors foreman, yet unnamed in court documents, arranged the purchase of the documents and Rubashkin allegedly asked human resources employees at the plant to work on Sunday, May 11, to complete all the new paperwork for several employees. The indictment states that Beebe was present that afternoon and assisted with the paperwork.

The indictment handed down yesterday by the grand jury relies heavily on the testimony provided by former Agriprocessors employees Martin De La Rosa, Juan Carlos Guerrero-Espinoza and Laura Althouse – all of which have been in federal court on their own immigration-related charges – to make the conspiracy, harboring and document fraud charges.

Previous court documents have indicated that 96 fraudulent alien resident cards and application paperwork were seized from the Agriprocessors human resources office on the day of the raid. Approximately 90 of the cards had numbers that were assigned to other people.

The bank fraud charges listed in the indictment stem from an incident on Feb. 29 in which Rubashkin, on behalf of the company, made a false certification to a lending bank that Agriprocessors was operating in a law-abiding manner, despite his having prior knowledge that numerous undocumented workers were employed at the plant. In addition, the indictment discusses Rubashkin’s alleged actions in September 2008 to divert customer payments away from a lender’s account, in order to enhance the Agriprocessors bottom line and pull additional funds from an existing line of credit tied to the customer payments.

“Beginning on a date unknown to the grand jury and continuing through about October 2008, in the Northern District of Iowa and elsewhere, defendants Agriprocessors and Sholom Rubashkin knowingly executed, and attempted to execute, a scheme to obtain funds under the control of First Bank and FBBC by means of fraudulent pretenses, representations and promises.

“… Rubashkin, on behalf of defendant Agriprocessors, and contrary to the terms of the loan agreement, diverted customer payments on accounts receivable. Defendant Rubashkin then hid from FBBC the fact that the customer payments had been received by, among other things, causing defendant Agriprocessors’ books to inaccurately reflect that no such payments had been received. By doing this, defendant Rubashkin cased defendant Agriprocessors’ books to inaccurately reflect that customers owed inflated amounts of money on their accounts. … Eventually, and in order to hide this portion of the scheme, defendant Rubashkin caused checks of Agriprocessors and third party entites he controlled to be drafted payable to defendant Agriprocessors and then presented to FBBC in such a way that they fraudulently appeared to be from a customer.”

The Penalties

The company faces numerous fines in conjunction with the charges. On five charges — the conspiracy to harbor, the harboring, the conspiracy to commit document fraud, the aiding and abetting document fraud, and aiding and abetting document fraud -– the company faces a fine of the greater of $500,000 or twice the pecuniary gain from the offense. Since the company was charged with six counts of aiding and abetting aggravated identity theft, the company faces the fine on each count. In addition, the company faces a fine of the greater of $1 million or twice the loss caused in relation to the bank fraud charges.

The individuals also face hefty fines for their alleged wrongdoings. The individuals, unlike the company, however, also face prison time.

The possible maximum penalty on charges of conspiracy to harbor is 10 years in prison, a $250,000 fine and three years of supervised release. Charges of harboring and aiding and abetting document fraud carry the same possible maximum sentence. Conspiracy to commit document fraud carries a possible maximum five years in prison, a $250,000 fine and three years of supervised release. Aiding and abetting aggravated identity theft carries a mandatory consecutive two years imprisonment, a $250,000 fine and one year of supervised release.

While two supervisors from Agriprocessors, a kosher meatpacking plant in Postville, were arrested this week in connection with a May 12 immigration raid at the plant and appeared in federal court, a third remains on the run.

As originally reported by Iowa Independent, Hosam Amara is believed to have fled the jurisdiction. Amara, according to former plant workers, was the master-mind behind a car sales scheme that encouraged undocumented workers to purchase used cars and fraudulently register them.

Juan Carlos Guerrero-Espinoza, 35, and Martin De La Rosa-Loera, 43, have become the first two members of the company’s management team to face charges since the May raid. Agriprocessors, the dominant kosher food company in the nation, is owned by the Rubashkin family. a politically-connected clan from Brooklyn, New York. Sholom Rubashkin stepped down as the company