Edit

ID NEWS: Scrutiny of USF woes intensifies; prosecutors said to plan to interview execs next week

Even as Royal Ahold, Zaandam, The Netherlands, announced a new credit facility, and banks under U.S. Foodservice (USF) receivables securitization programs extended their programs until the last week of April, more allegations were surfacing concerning USF business practices.

According to the Wall Street Journal, the $17.5-billion distributor embarked upon a buy-in "initiative" last fall to help employees earn bonus monies and at the same time help the broadliner meet its own yearly earnings targets. (WSJ cites two senior managers as its source.) USF then booked the "hefty" rebates immediately to try to boost 2002 earnings.

USF lawyer White & Case, heading the investigation for Ahold, addressed these issues with the WSJ, stressing that the company is cooperating fully with the investigation.

The situation has "cast light," says the WSJ, on "little-known arrangements" among manufacturers, distributors and their customers.

Meanwhile, the Washington Post has reported that federal prosecutors are seeking to interview USF executives next week.

Trending

More from our partners