By KEVIN WALKER
Michigan Correspondent

WASHINGTON, D.C. — USDA Inspector General Phyllis Fong has cleared the United Soybean Board (USB) of any wrongdoing after it reviewed allegations brought against the organization by the American Soybean Assoc. (ASA).

In a seven-page letter to Sen. Charles Grassley (R-Iowa) dated July 23, Fong reviewed the allegations that the ASA made more than a year ago against the USB and associated entities, including the U.S. Soybean Export Council (USSEC). According to the letter, the ASA alleged misconduct on the part of the former USSEC CEO, mismanagement and misuse of funds by the USB and USSEC and conflict of interest on the part of the law firm representing the USB and USSEC.

On July 26, the ASA put out a statement about the matter, which reads in part, “substantial management and board changes have been made at the (USSEC) after ASA asked for an (Office of Inspector General) investigation. The now former USSEC CEO was placed on administrative leave and the board of directors has been restructured.

“As a result of the significant leadership and management changes that have been made at USSEC, we believe soybean farmer interests are being better served.”

The current president of the ASA, Rob Joslin, said the USSEC board has been made a little smaller, with 15 members now rather than 19. The makeup of the board has also changed. Previously it was seven members from the ASA, seven from the USB and five from industry affiliates. Now it’s four from ASA, four from USB and seven from industry affiliates.

“That was a joint decision of the ASA and USB,” Joslin said. “They thought this would be good for the industry. It’s just a broader outreach.”

He said there is still friction between the ASA and USB, although he declined to detail what exactly the friction is about; however, he added his personal relationship with current USB Chair Phil Bradshaw is excellent.

According to the letter, friction between the two organizations goes back to 2005 when the soybean checkoff was created.

“We’re working hard trying to resolve this,” Joslin said.

Though the letter clears the USB of wrongdoing related to activities over which the OIG has jurisdiction, the letter also states “allegations of misconduct and harassment relating to the former USSEC CEO were beyond OIG’s jurisdiction; however, we determined the allegations were assessed by the appropriate entities and action taken when warranted.”

The allegations laid out in the letter include: the USSEC awarded a $200,000 “no competitive bid” contract; contracts made by the USSEC European office for feeding trials were improper and wasteful – that is, nearly $1.7 million was spent over three years to carry out repetitive trials; USB deliberately evaded the 1 percent administrative salary cap improperly; USB evaded the 5 percent administrative cap by misclassifying soybean checkoff expenses; USB violated the law by using USB-created entities such as Qualisoy and spent millions of dollars in checkoff funds to lobby on policy; USB contractors traveled to Washington, D.C., to lobby government officials; and several other allegations of improper or illegal activity.

Fong wrote that none of these allegations was found to have any merit; “(W)e recommend USB provide closer oversight of USSEC and other subcontractor funding requests. Again, it is our conclusion that we found insufficient evidence to support ASA’s allegations; although we do recommend closer oversight by USB of USSEC, in the future ...

“It is our understanding that additional internal agency reviews and an OIG audit will be conducted on various aspects of the USDA marketing boards. However, those reviews will be reported separately.”