Did Rancho cattle have cancer?

A criminal investigation into Rancho Feeding Corporation is examining allegations the Petaluma plant slaughtered cows with cancer and illegally sold the carcasses as healthy meat, according to a source with knowledge of the probe.

"Basically, Rancho had figured out a way to sell meat for profit that they would otherwise have had to destroy," said the source, who spoke on condition of anonymity.

Federal investigators believe the heads of cows with eye cancer were cut off, apparently to remove evidence, the source said. Meat from the diseased cows was then mingled with healthy meat and sold under the Rancho brand, the source said.

Federal law forbids meat from diseased cows from being sold for human consumption.

The source said the USDA discovered a crucial piece of evidence when an investigator followed a Rancho truck from Petaluma to a meat rendering plant near Sacramento. Inside were cow heads that didn't match carcasses, the source said.

Robert Singleton, who owns Rancho with partner Jesse "Babe" Amaral, declined Wednesday to discuss the allegations.

"I cannot comment," he said.

The slaughterhouse, which closed Feb. 9, is at the center of an international recall of all beef and veal produced at the plant in 2013, some 8.7 million pounds of meat. No illnesses linked to the meat have been reported. The company is being investigated by the U.S. Department of Agriculture, the USDA's inspector general and the U.S. Attorney's Office.

The USDA has said the plant is under investigation for "intermittent circumvention" of the inspection process, which involves repeated examinations of the animal from the time it leaves the truck at the slaughterhouse through its death and processing.

The scheme described by the source would have had to completely bypass the inspection process or else involve the USDA veterinarian or inspector assigned to the slaughterhouse, a former USDA supervising veterinarian said.

"There's no way that an inspector doing what they're supposed to be doing is going to look at a cow that's dead and has no head," said Daryl Jacobs, who retired in 2012 after eight years as supervising public health veterinarian of the Valley Beef slaughterhouse in Wendell, Idaho.

"The head is the key to the inspection process, it's where you start," he said.

The source said federal officials believe someone at Rancho devised a way to get the carcasses of cancerous cows past a USDA supervising veterinarian, obtain USDA certification for distribution and sell the meat under the Rancho brand.

The USDA has declined to reveal the names of the inspector or veterinarian assigned to Rancho Feeding. Independent efforts to identify and locate them have been unsuccessful.

The recall has ensnared tens of thousands of pounds of meat belonging to custom beef ranchers whose cattle were slaughtered at Rancho separately from the dairy cows that Rancho bought, killed and sold under its own brand.

On Wednesday evening, Amaral's attorney called on the USDA to release meat that Rancho processed for Bolinas rancher Bill Niman and other custom beef producers who hired the Petaluma company to slaughter their cattle. Niman has more than $300,000 worth of frozen beef slaughtered at Rancho that his BN Ranch cannot sell because of the recall.

"None of Bill Niman's cows, or the meat from other local custom beef ranchers, were in any way tainted, diseased or uninspected. The records and documentation obtained by federal investigators support this fact," attorney Jeffrey Bornstein said in a statement.

The statement, notably, made no reference to meat sold under the Rancho brand.

Bornstein declined to discuss the allegations that Rancho knowingly sent diseased carcasses to market. Nor would he comment on why the statement did not address USDA allegations about diseased meat and the circumvention of the inspection process.

"He (Amaral) is simply trying to make sure that it's clear that there are no doubts that the meat that Mr. Niman has, and that other custom local ranchers have, is absolutely wholesome and fully inspected," Bornstein said.

Amaral and Rancho are cooperating with federal investigators, Bornstein said.

"He is very sorry for any impact that this situation has caused to his customers and the meat-buying public," the statement said.

The USDA has been silent on most matters related to the recall and investigation. That has frustrated North Coast legislators trying to help Niman and other ranchers prove their beef was properly inspected, fully healthy and not mingled with diseased meat.

"If we could just get some facts from USDA I think these producers could demonstrate that. But the problem is USDA has put out this sweeping recall and won't tell anyone what happened," said Rep. Jared Huffman, D-San Rafael, who was briefed Monday by Agriculture Secretary Tom Vilsack.

"The secretary felt that he was unable to share specifics with us because of the pending investigation," Huffman said. "I get no facts beyond what was already reported in the media."

"They have been pretty tight-lipped on anything," said Rep. Mike Thompson, D-St. Helena, who was on the telephone briefing with Vilsack.

"There's some things that the secretary told me that I was asked not to disclose," said Thompson, "but it's very little and doesn't amount to a hill of beans. It wasn't very earth shattering."

Staff Writer Robert Digitale contributed to this story.