Kosher plant placed in federal receivership

CEDAR RAPIDS, Iowa, Nov. 2 (UPI) -- A judge in Iowa has placed a kosher meatpacking company in receivership after it defaulted on a $35 million loan and allegedly wrote $1.4 million in bad checks.

According to a lawsuit filed last week in federal court in Cedar Rapids, Agriprocessors Inc. in Postville failed to keep current on the revolving loan it took out in 1999, The New York Times reported Sunday.

First Bank Business Capital of St. Louis, which sued the company to have it placed in receivership, claims the meat processor also violated the loan terms by diverting nearly $1.4 million from First Bank accounts to another bank to issue payroll checks on Oct. 24.

Last week, the Iowa labor commissioner levied $10 million in fines against the company for wage violations.

The company gained national attention in May, after its plant was raided and 400 illegal immigrant workers were arrested. Additionally, company executives are facing criminal charges for child labor violations.