SEC Settles With Rica
Foods
The U.S. Securities and
Exchange Commission has
settled civil claims
against Rica Foods and
its former CEO Calixto
Chaves, who now lives in
Costa Rica, according to
a press release.
Rica Foods, Inc. is the
parent corporation of
the largest producers of
poultry products -
Corporacion Pipasa (Pipasa)
and Corporacion As de
Oros (As de Oros)
- in Costa Rica and
becoming among the
largest in Central
America and the
Caribbean.
Rica, a poultry
processor and animal
feed company which once
had its corporate
offices in Miami, traded
on the American Stock
Exchange until it was
delisted in November
2006.
The SEC’s complaint
alleged that while
serving as Rica’s CEO,
Chaves engaged in
“pervasive
self-dealing.”
Specifically, the
complaint said that
between 1998 and 2004,
Chaves "pledged and
encumbered numerous
assets belonging to Rica
in order to secure
approximately us$37
million in loans made to
him and entities under
his control."
In addition, Chaves is
alleged to have caused
Rica to purchase
approximately us$24
million worth of real
property and other
assets owned by Chaves
and his family.
Rica and Chaves, who
resigned as CEO in
January 2005, each
consented to the
agreement, without
admitting or denying the
allegations in the SEC’s
complaint.
As part of the final
order, Rica and Chaves
agreed not to violate
securities laws. In
addition, Rica was
ordered to pay a
us$50,000 fine and was
permanently barred from
serving as an officer or
director of a public
company in the U.S.
Rica, which is
headquartered in Costa
Rica, consented to an
order revoking the
registration of its
securities.
In Costa Rica, the
company supplies such
major restaurant
franchises as Burger
King, Subway, Kentucky
Fried Chicken, Pizza
Hut, and Taco Bell. The
most profitable category
for the company,
however, is chicken
byproducts, which
include sausages,
bologna, chicken nuggets
and patties,
frankfurters, salami,
and pate. These products
are sold under multiple
brand names to
supermarkets. The Kimby
brand is Costa Rica's
top seller of chicken
byproducts.
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