High Plains Livestock faces lawsuit

and Alisa Boswell

STAFF WRITERS

The U.S. Department of Agriculture filed a civil lawsuit against a Roosevelt County livestock auction Wednesday, alleging several counts of livestock fraud.

The New Mexico Livestock Auction Board suspended the license of High Plains Livestock LLC in February after placing the company under investigation for allegations of violating state and federal livestock laws.

High Plains Livestock owner Michael Flen and secretary Darcie Pareo were arrested Feb. 9 on multiple counts of “violation of livestock auction markets.”

Another individual, Calvin Pareo, was named in the lawsuit as someone who was not employed by the company and received no salary but acted as a dealer, buying and selling cattle on behalf of the company, without being registered to do so.

Attempts to reach Flen at his Portales home were unsuccessful.

Darcie and Calvin Pareo, both of Clovis, could not be reached for comment.

The following are specific dates and instances related to the allegations, which were highlighted in the lawsuit:

• On Nov. 10, 2014, Darcie Pareo signed a Civil Penalty Stipulation Agreement on behalf of HPL to resolve allegations of shortages in HPL’s custodial account. The company paid a penalty of $6,600 to the U.S. Treasury for the discrepancies.

•In December 2014, an agent of the Department of Agriculture, Grain, Inspection, Packers, and Stockyards Administrators (GIPSA) conducted a follow-up review and discovered scale tickets appeared to have been altered.

•On Jan. 25, 2015, individuals from the New Mexico Livestock Board, GIPSA and the Ninth Judicial District Attorney’s Office executed a search warrant at HPL, arresting Darcie Pareo and Flen shortly after.

According to the lawsuit, “a cow was taken into a ring, which was also a scale, the scale was balanced, the cow was weighed, and a ‘scale ticket,’ indicating the cow’s weight, was printed. Bids were solicited for the cow. For each sale, the clerk weighing the cow wrote on the scale ticket: The number identifying the cow, any abnormal physical condition of the cow, the amount of the winning bid and the number assigned to the buyer with the high bid.”

After the tickets were entered into the company’s sale software, according to the lawsuit, the buyer number and the condition of the cow were altered as well as the highest bid.

The lawsuit stated that the “defendants inaccurately and fraudulently entered the purported bid amount on seller invoices and/or scale tickets in their favor for 168 transactions ... some of the sellers’ invoices had notations which would appear to justify the lower bids, such as sick, ‘sad,’ or crippled cows. (But) the same information is not noted on the related scale tickets, which is where the cow’s condition would have been originally noted.”

The lawsuit gave the following scenario as an example of the company’s alleged fraudulent activities:

A buyer bid 92 cents per 100 pounds of weight for a cow with the tag number for a total value of $1,127. The review of the scale ticket showed the ticket was altered from 92 cents to 82 cents with no indication that the cow showed infirmaries. HPL officials also changed the buyer’s number, allowing the defendants to keep $122.50 for the single cow.

The lawsuit stated that a total of $240,000 was fraudulently collected from sellers by High Plains Livestock.

The lawsuit also stated that the company’s bank account showed a deficit exceeding $600,000 on three separate occasions with the company continuing operations despite being overdrawn.

All of the charges have a possible civil penalty of up to $11,000 per violation, according to the lawsuit.

According to nmcourts.com, the criminal charges against Darcie Pareo were dismissed.

Officials at the district attorney’s office said they would not be available for comment until today.

Flen has a jury trial set for 9 a.m. on Sept. 15.