In December, the Lynchburg Livestock Market was fined $10,000 for improper use of custodial funds.
The U.S Department of Agriculture issued the fine after discovering that money in the account was being used by the bank. A federal law forbids the use of money in a custodial count for any other purpose than to hold money owed to livestock owners and other parties.
Market co-owner Matt Fariss, a state delegate, told Alicia Petska that the company was allowing its bank to temporarily use the funds in an overnight account that generated interest for both the bank and the market.
“We didn’t realize that the [Packers and Stockyards Act] did not allow us to move those custodial funds,” he said, referencing the federal law that governs the industry.
Farris notes that the fine amount is near the amount of interest they collected. This is second reprimand in two years for this market.