U.S. federal investigators reportedly received "general information" showing that representatives of these manufacturers "colluded" with executives of USF to inflate supplier rebates. The collusion is said to have involved "false confirms" substantiating amounts of promo allowances listed by USF on its books when, in fact, the supplier reps "knew" a smaller sum would be paid.
Omaha, NE-based ConAgra has declined to comment and Chicago-based Sara Lee says it has not been contacted by any investigative body. Sara Lee's spokesperson told the Journal that the allegations are "untrue" and "unsubstantiated."
The development is "likely to rock" the $500-billion U.S. food industry and has "broad ramifications" for the way manufacturers sell products to distributors, the Journal said.