Cincinnati, OH - Federal authorities have accused a meat-processing company of selling beef with too much fat - after an investigation that began with a complaint at the Chillicothe Veterans Affairs Medical Center..

They say Brandy Meats Inc. and the company's owner, Robert Baldhoff, mislabeled nearly 40,000 pounds of beef as having a 10 percent fat content, when it had some 20 percent fat. The company also is accused of labeling 4,700 pounds of ground beef as more-expensive ground sirloin.

The mislabeling cost the company's customers about $10,000 and broke federal law, prosecutors say.

Baldhoff signed a plea agreement admitting fraud, but he said the labeling problem was an honest mistake and not as extensive as federal authorities claim. He said only about 8,000 pounds of beef was mislabeled. "This is awful," Baldhoff said Tuesday. "We've been in business 28 years, and this is the first time we've had anything like this happen."

Brandy Meats sells beef in Ohio and several other states, mainly to other wholesalers and institutions such as Veterans Affairs hospitals.

Fred Alverson, spokesman for U.S. Attorney Greg Lockhart of the Southern District of Ohio, said the U.S. Department of Agriculture discovered the labeling problem more than two years ago, when it tested some of Brandy Meats' beef.

He said a criminal investigation began when tests at a VA Hospital in Chillicothe found the problem hadn't been corrected.

He said USDA officials found no other problems with the beef but were concerned about people monitoring fat in their diet.

Baldhoff faces a maximum sentence of three years in prison and a $250,000 fine.

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