January 21, 10

NEWS / CEO of Seafood Importer Pleads Guilty to Importing and Selling Falsely Labeled Fish from Vietnam

Attempts to Evade $60 Million in Federal Tariffs

WASHINGTON—The chief executive officer of Sterling Seafood Corporation located in Cresskill, N.J., pleaded guilty today to importing falsely labeled fish from Vietnam and evading over $60 million in federal tariffs, as well as selling over $500,000 in similarly misbranded fish purchased from another importer in the United States, the Justice Department announced.

Thomas George, 61, of Old Tappan, N.J., made his first appearance in federal court and pleaded guilty before U.S. Magistrate Judge Patty Shwartz for the District of New Jersey to a two-count information charging him with one count of importing falsely labeled goods into the United States and one of selling falsely labeled fish in the United States with the intent to defraud. Sentencing is scheduled for April 28, 2010, before U.S. District Judge Faith S. Hochberg.

"This case is an example of effective coordination among federal law enforcement agencies to investigate illegal activity that hurts economic markets, defrauds consumers and masks the depletion of fishery resources by substituting a lower value farmed species for one being depleted in the wild," said Ignacia S. Moreno, Assistant Attorney General for the Justice Department’s Environment and Natural Resources Division.

"Today’s plea reflects this office’s commitment to enforcing customs duties and prosecuting consumer fraud," said Paul J. Fishman, U.S. Attorney for the District of New Jersey. "This office will continue to protect fair competition in the marketplace and consumers’ right to know what they are purchasing."

"ICE will use its global law enforcement experience, expertise and proficiency to investigate, disrupt and dismantle organizations that engage in grand scale consumer fraud, "said Peter T. Edge, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s Office of Investigations in Newark. "While the monetary loss to the U.S. government in this case was significant, American consumers have a right to be protected from improperly labeled seafood."

An investigation by special agents with ICE revealed that from January 2003 to June 2006, George maintained a business relationship through Sterling Seafood with a seafood distribution company located in Vietnam. As part of that business relationship, Sterling Seafood regularly purchased a type of fish, specifically Pagasius hypophthalmus, sometimes referred to as Vietnamese catfish. Sterling Seafood would then resell the product in the United States.

In the interest of fairly regulating commerce in the United States, the U.S. Department of Commerce establishes antidumping duties or tariffs on certain imported products. In January 2003, an anti-dumping duty or tariff was placed on all imports of Vietnamese catfish into the United States because the Vietnamese catfish was being marketed at a significantly lower price than was market rate at the time. That initial anti-dumping order imposed a duty of up to 63.88 percent on fish subject to the order which was adjusted at various later dates based on market conditions.

At his plea hearing, George admitted that from 2004 to 2006, he agreed with the Vietnamese distribution company to engage in a scheme to falsely identify and declare the purchase and importation of the Vietnamese catfish in order to evade the applicable anti-dumping duties. George stated he specifically instructed the Vietnamese company to fraudulently identify the Vietnamese catfish as "grouper" on commercial contracts, purchase orders, and other documents because grouper fish was not subject to any anti-dumping duties. George further admitted that, based upon these false statements and fraudulent documents, he, through Sterling Seafood, avoided over $60 million in anti-dumping duties.

Additionally, George admitted that from 2004 to 2005 he purchased over $500,000 of similarly misbranded fish that was imported by a Virginia corporation from Vietnam and then sold that misbranded fish throughout the United States.

The charge of importing of falsely labeled goods into the United States carries a maximum statutory sentence of two years in prison and a $250,000 fine, or twice the monetary gain derived from the offense. The second count, which charges selling misbranded fish in the United States, carries a maximum statutory sentence of three years in prison and a $250,000 fine, or twice the monetary gain derived from the offense.

In addition, George has agreed to make a $50,000 community service payment to the National Fish and Wildlife Foundation to be expressly designated for research into the identification of fish and other marine organisms.

The case was investigated by special agents with ICE, NOAA Fisheries Office of Law Enforcement, FDA Office of Criminal Investigations. The case is being prosecuted by the U.S. Attorney’s office for the District of New Jersey and the Justice Department’s Environmental Crimes Section in Washington, D.C.

http://www.justice.gov/opa/pr/2010/January/10-enrd-054.html

Tags: document, criminal investigation, corporation,