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Seafood Scammers Lured in $145,625 in Unpaid Duties
Two seafood wholesalers, Karen L. Blyth and David H.M. Phelps, pleaded guilty to selling farm raised Asian catfish and Lake Victoria perch falsely labeled as grouper, and selling foreign farm-raised shrimp falsely labeled as U.S. wild caught shrimp, as part of a massive seafood scam.
Blyth, of Paradise Valley, Ariz., was the co-owner and president of two companies, Consolidated Seafood Enterprises Inc., located in Phoenix, and Reel Fish and Seafood, Inc., located in Pensacola, Fla. Phelps, of Scottsdale, Ariz., co-owned Consolidated Seafood and Reel Fish and served as a vice president in both companies.
The defendants admitted using Consolidated Seafood to buy frozen fillets of a type of farm raised catfish from Vietnam with the genus Pangasius, called sutchi, that they knew had been imported into the United States and falsely declared as wild caught sole, in order to avoid anti-dumping duties that were owed on this product.
The scam, which took place over several years, involved the purchase and sale of approximately 283,500 pounds of farm raised sutchi, which was imported without $145,625 of anti-dumping duties having been paid.
Assistant Attorney General Ignacia S. Moreno said, “These defendants have admitted to flouting federal laws in a misguided scheme to defraud the American consumer. Today’s convictions send the message that we will pursue others who engage in illegal activity.”
The case is a reminder of the importance of protecting domestic catfish producers from unfair foreign competition. Raymond R. Parmer, Jr., Special Agent in Charge, U.S. Department of Homeland Security, Homeland Security Investigations, said, “Those that conspire to and buy such a product knowing that it was imported illegally will be brought to justice and punished.”
Some of the fish seized during the investigation tested positive for malachite green and Enrofloxin, both of which are banned from U.S. food.
The convictions are a significant blow to the seafood industry, which relies on accurate labeling and fair trade practices. U.S. Attorney Kenyen R. Brown said, “These prosecutions should send a clear message that instances of consumer fraud will be vigorously prosecuted and that this U.S. Attorney’s Office will continue to protect local seafood consumers and all components of the local seafood market and industry.”
Key Facts
- State: Federal
- Category: White Collar Crime
- Source: DOJ Press Release ↗
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