Feds chasing down seafood fraud


Zen Chinese Restaurant and Jaded Lounge

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Zen restaurant is the most recent, but it may not be the last.

That suggestion from federal fisheries enforcement officials after owners of the Juneau restaurant Cai and Yao Hu admitted serving up subsistence-caught halibut and agreed to pay a hefty fine.

The original Notice of Violation and Assessment of Administrative Penalty (NOVA) says the restaurant’s owner-operators were actually penalized $20,900. That’s the base penalty plus estimated costs avoided by buying halibut at below commercial fair market value.

The Hus bought a total of 271 pounds of subsistence-caught halibut.

Julie Speegle, spokeswoman for the National Oceanic and Atmospheric Administration, said the fine was commensurate with the small amount of fish purchased.

Federal fisheries investigators say they provided the halibut for the subsistence fisherman to sell to the restaurant during an undercover operation. He did not catch the halibut himself.

“This person who made the sales was cooperating with the government,” said Speegle.

The Hus bought the fish on two separate occasions between February 1, 2010 and March 9, 2010 for what appears to be no more than $5 per pound.

It’s a unique Alaskan twist on what may be a widespread problem in a competitive global seafood market.

Margot Stiles, senior scientist with the conservation and advocacy organization Oceana, says seafood fraud is an economic crime that can hurt retailers and consumers. Stiles co-authored a report that suggests between 25- and 70-percent of the seafood sold in stores or served up in restaurants may be the result of species substitution. You may not be eating what you think you’re eating.

“If they’re lying (about) what the identity of the fish is, then you really have to wonder whether if it’s fresh and what else they’re not telling you,” said Stiles.

Stiles also said it can be risky to human health if a consumer has an allergy to a specific fish and they get something different than what they expected.

Species availability is one reason for substitutions. You may get farmed Atlantic salmon during the off-season for fresh wild salmon. Stiles says other common substitutions include pollock for cod, and rockfish or tilapia for red snapper.

Here in Juneau, a restaurant like Zen at the Goldbelt Hotel could get subsistence-caught fish at a steep discount to the usual wholesale price of $10 per pound and still pocket a hefty margin for their halibut dishes. But it’s unfair competition for the honest commercial longliner or processor.

The Zen case was settled administratively, as a civil matter under the Northern Pacific Halibut Act. That law specifically prohibits the sale and purchase, trade or barter of subsistence-harvested halibut as outlined either in statute or regulation.

We continued trying getting comment out of the Hus. Mitchell Hu, manager of Zen, told KTOO at his restaurant March 21st that he was also the Cai Hu that was named as co-owner. But he declined to answer most questions and said he “had no comment at this time.”

This isn’t the first time that a Juneau restaurant has been caught buying subsistence-caught halibut. The now-defunct Doc Water’s Pub, a restaurant that was located in the Merchants Wharf downtown, purchased over 4,500 pounds of the flatfish starting in 2005 until early 2008 when federal agents raided the place. Doc Water’s bought their subsistence-caught halibut for as low as $4 per pound.

Susan Auer, senior enforcement attorney for NOAA’s office of general counsel, declined to talk on tape for this story. But she said such a quantity purchased over an extended period may have been why they referred the case to prosecutors for potential criminal charges under the Lacey Act. That’s the federal law prohibiting sale or purchase of fish or wildlife that’s been in violation of another state or federal law. In this case, the underlying law that was violated was the Northern Pacific Halibut Act.

Doc Water’s owner Jason Derek Maroney was sentenced to ten-months in prison to be served as community confinement, and a year of supervised release. David Allen Skrzynski, a Juneau-based commercial salmon fisherman and holder of a subsistence halibut registration certificate or SHARC card, was sentenced to twelve months and a day in prison, and three years of supervised release. Part of Skrzynski’s plea agreement entered in the federal court system on March 10, 2010 remains under seal. That’s as little as one day after the last reported sale to Zen. And the recent NOVA filed against the Cai and Yao Hu specifically names Skrzynski as the fisherman who sold them the subsistence fish during the undercover operation.

“This type of thing is more common than we like to think,” said NOAA’s Julie Speegle.

NOAA attorney Susan Auer also sees it as an increasing problem. She said restaurant and lodge owners have not been careful about the source of fish that they’ve been purchasing. They either have been reselling them as meals or repackaging them for their clients. Auer said she believes there are other cases already in the works.