SEC Investigates Monsanto's Shady Dealings

Apparently the feds aren't impressed with the biotech giant's paying farmers to plant its seeds and use its herbicide.

July 1, 2011

RODALE NEWS, EMMAUS, PA—Biotech giant and GMO-seed producer Monsanto now has the weight of the feds on its back. On Wednesday, the company announced that the Securities Exchange Commission (SEC) was investigating its recent customer incentive program. Between 2009 and 2010, Monsanto started paying farmers to use its competitors' pesticide products because glyphosate (sold under the trade name Roundup), Monsanto's best-selling herbicide, had been so overused that pesticide-resistant superweeds were popping up on farms and rendering it ineffective.

THE DETAILS: Neither Monsanto nor the SEC is releasing many details about the investigation, except to say that the investigation is related "to financial incentives Monsanto offered to distributors who carry its glyphosate products and the financial reporting of those incentives," and that Monsanto is "cooperating fully," according to a Monsanto press release.


As we reported last November, Monsanto had started paying up to $20 an acre for farmers to plant its patented corn, cotton and soy crops that are genetically modified (GM) to resist Roundup. And they began offering rebates to farmers of between $3 to $20 per acre to use Roundup in conjunction with herbicides from other companies in order to manage Roundup-resistant "superweeds," some of which are so tough they destroy farm equipment and must be removed by hand. The development of Roundup Ready crops and the surging use of Roundup have combined to create these superweeds, which have overtaken as much as 5 million acres of American farmland.

Their efforts appeared to pay off, at least as far as Monsanto's bottom line was concerned. On Wednesday, the New York Times reported that the company announced a 77 percent increase in net income, far exceeding investors' expectations. Its corn and soybean sales jumped 10 percent from last year, and sales of Roundup jumped an incredible 57 percent. When its financials were announced, shares of the company's stock were up 21 percent.

WHAT IT MEANS: Monsanto may finally know what it's like to be at the wrong end of a telescope. The company is infamous for spying on farmers to make sure that no one is, knowingly or not, profiting off its patented seeds. In the documentary Food Inc., director Robert Kenner interviewed multiple farmers whose fields had been contaminated by "gene drift" (when genes from a GM seed contaminate a field of non-GM crops) and were then bankrupted by lawsuits filed by Monsanto for violating their patent. And in September 2010, the magazine The Nation acquired documents revealing that Blackwater, the agency accused of multiple questionable shooting deaths during the Iraq war, was seeking to become "the 'intel arm' of Monsanto, offering to provide operatives to infiltrate activist groups organizing against the multinational biotech firm."

In addition to the SEC investigation, Monsanto is also under an anti-trust investigation by the Department of Justice. Though there are multiple biotech corporations developing GM seeds, at least one of Monsanto's patented genes exists in 90 percent of soy and 80 percent of corn planted in the US. Due to the company's massive control on the seed market, seed prices have risen 56 percent in the last five years.

Want to stand against Monsanto's sketchy business practices? Here are a few things you can do:

• Buy organic food. The only guarantee that you won't be eating one of Monsanto's, or any other biotech company's, GM crops, or any crops sprayed with Roundup, is organic food. Organic certification prohibits the use of biotechnology and toxic pesticides.

• Buy organic seeds. Even home gardens are susceptible to infiltration by biotech companies. Many home-gardener seed catalogs sell seeds produced by divisions of Monsanto, Syngenta and others, and it's hard to know which ones are which. Buying organic seeds from small producers; for suggestions, see Why You Should Buy Organic Seeds.

• Manage an organic lawn. You may have seen an increase in the number of ads for Roundup on TV lately; that's the same Roundup sold to farmers and creating massive superweeds. There are a lot of natural lawn care remedies for weeds, ranging from clover (which you actually should want to keep around) to crabgrass, that don't require herbicides. See 7 Chemical-Free Fixes for Common Lawn Problems and Your Lawn Care Problems Solved, Organically.

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