Executive pleads guilty to tomato price fixing

SACRAMENTO, Calif. – A former California food company owner pleaded guilty to racketeering Thursday in a tomato price-fixing plot that authorities said drove up costs to consumers across the nation.

Frederick Scott Salyer, 56, was charged with bribing purchasing managers at food giants including Kraft Foods Inc. and Frito-Lay to buy tomato products from his company, Monterey-based SK Foods. Prosecutors said he and his co-conspirators fixed prices and rigged bids for the sale of tomato products to McCain Foods USA Inc., ConAgra Foods Inc. and Kraft.

Salyer pleaded guilty in federal court in Sacramento to two charges: racketeering and price fixing. Racketeering carries a maximum 20-year prison sentence and price-fixing 10 years, although under a plea agreement Salyer is expected to face four to seven years behind bars. He remains under house arrest at his Pebble Beach estate on $6 million bail until his sentencing, which is scheduled for July 10.

Salyer was accused of being at the center of a price-fixing ring that helped SK Foods capture 14 percent of the processed tomato market and rise to the second largest tomato processor in the state before investigators raided the company in 2008.

He also admitted that SK Foods routinely falsified lab test results for its tomato paste and that he ordered former employees to falsify information including the product’s mold content, production date and whether it qualified as “organic,” the U.S. attorney’s office said.

Buyers from Kraft, PepsiCo Inc.’s Frito-Lay unit, Safeway Inc. and B&G Foods Inc. have pleaded guilty to accepting bribes in the case.

WASHINGTON – Sales of U.S. new homes fell in February for the second straight month, a reminder that the depressed housing market remains weak despite some improvement.

The Commerce Department said Friday that new-home sales dropped 1.6 percent last month to a seasonally adjusted annual rate of 313,000 homes. Sales have fallen nearly 7 percent since December.

While a mild winter and three months of strong job growth have lifted resales, those conditions haven’t benefited the new-home market. The current pace is less than half the 700,000 that economists consider to be healthy.

Program to let at-risk homeowners be renters

WASHINGTON – Bank of America has launched a pilot program that will let some homeowners at risk of foreclosure become renters and stay in their homes.

Fewer than 1,000 borrowers in Arizona, Nevada and New York will be enrolled in the test program, which began this week. Those selected will transfer the title of their homes back to Bank of America and have their mortgage debt forgiven.

The homeowners can rent the homes for up to three years at or below their area’s market rental rate. The rental payments will be less than the borrowers’ mortgage payments, the bank said. And they will not have to pay property taxes or homeowner’s insurance.

The program, called “Mortgage to Lease,” uses an old but increasingly popular technique for lenders. It’s called a “deed in lieu of foreclosure.” It occurs when homeowners turn over the deed to their house to their lender because they can’t make the monthly payments.

The technique was used during the Great Depression but fell out of favor after the 1930s.