Kraft, Frito-Lay buyers to plead guilty to bribery

by Staff
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SACRAMENTO, CALIF. — Robert Watson and James Wahl Jr., former purchasing executives with Kraft Foods Inc. and Frito-Lay, Inc., respectively, have agreed to plead guilty to accepting hundreds of thousands of dollars in bribes as part of a plan to drive up food prices.

Mr. Watson, a former Kraft senior purchasing manager, admitted to accepting $158,000 from SK Foods, a California-based tomato processor, while Mr. Wahl, a former Frito-Lay purchaser, agreed to plead guilty to accepting about $160,000.

According to the charges, Mr. Watson and Mr. Wahl both helped Randall Lee Rahal, a sales broker and director at Lemoore, Calif.-based SK Foods, to charge their respective companies with inflated prices. For his part, Mr. Watson was charged with making sure Kraft purchased approximately 203 million lbs of processed tomato products from SK Foods at higher prices between 2004 and 2008. He pleaded guilty to two counts of honest services mail fraud. Sentencing is set for May 5.

Mr. Wahl, meanwhile, was charged with two counts of honest services mail fraud for allegedly accepting bribes between 1998 and 2008 in exchange for giving SK Foods information that let it charge Frito-Lay inflated prices. He is set to plead guilty in the near future.

Mr. Rahal pleaded guilty Dec. 16 to racketeering, price fixing, bid rigging and contract conspiracies.

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