In an unprecedented punishment, federal regulators Monday ordered scores of commercial fishermen in Massachusetts to return their vessels to shore after the owner of many of the boats, a New Bedford fishing mogul known as “The Codfather,” failed to account for the fish they caught and orchestrated a massive fraud.
The move immediately prohibits 60 permit holders, including 22 active vessels, from going back to sea until at least the start of the new fishing season in May.
Most of the vessels were operated by Carlos Rafael, the magnate who was recently convicted of one of the nation’s largest violations of fishing regulations.
The penalties could also cost dozens of fishermen their jobs and cause significant economic losses for the icehouses, fuel companies, and other businesses that supply the boats.
The decision by the National Oceanic and Atmospheric Administration affects what is known as Northeast Fishery Sector Nine, one of 19 such federally permitted cooperatives in the region that share fishing quotas. This year, the group had been given a quota of 20 million pounds — or 10 percent — of the region’s cod, haddock, flounder, and other bottom-dwelling species.
In a letter to the group, John Bullard, NOAA’s regional administrator, accused its staff of failing to carry out its most basic duties.
“Accurate reporting, internal accountability, and organizational integrity are core principles of the sector system,” Bullard wrote. The group “has failed its primary responsibility of accurately reporting and tracking its catch and has taken only minimal, insufficient steps to ensure accurate reporting and compliance.”
Rafael, who was sentenced in September to nearly four years in prison for tax evasion and flouting fishing quotas, served as the sector’s president until last May.
Sector officials said they were “blindsided” by NOAA’s actions, noting that they have appointed a new board of directors, created a new enforcement committee to address the fraud, and met last month with NOAA officials to discuss ways to make amends.
“We’re very upset about this, because we want to do the right thing,” said Virginia Martins, who succeeded Rafael as sector president.
Martins estimated that the punishment will cost about 85 fishermen their jobs. Most of them fish out of New Bedford.
“It’s crazy to do this, especially at Thanksgiving,” Martins said. “This is so unfair, so hurtful. How can you do this to men who are willing to sacrifice their lives to make a living? What else are they going to do? We can’t afford to have these boats tied up.”
In a statement, Rafael’s wife, Connie, a part-owner of some of the boats, said she hoped there might be a way to overturn the federal order.
“We are hopeful that the legal system will provide this community with a meaningful opportunity to review this unexpected and unilateral decision by NOAA, so that hard-working families are not needlessly harmed during this holiday season,” she said.
This step ‘had to be taken to try to rebuild trust within the industry.’— John Pappalardo, Cape Cod Fishermen’s Alliance chief executuive
Last month, a federal judge in Boston ordered Rafael to forfeit his interest in four vessels and their permits, which have been valued at nearly $2.3 million.
Rafael, 65, who owns one of the nation’s largest groundfish fishing fleets, is also facing potential further penalties from ongoing civil proceedings by NOAA. That action could result in the government confiscating his remaining vessels.
Environmental advocates, who have pressed NOAA to take action against the cooperative, said stiff penalties were crucial to preserving a system that relies on fishermen’s honesty to report accurate counts.
Without such tallies, protecting vulnerable species in the region, such as cod, would be difficult, advocates say. The cod population has fallen to a historic low — about 6 percent of the level needed to sustain a healthy fishery, according to recent surveys.
“From all accounts, Sector Nine was complicit in Rafael’s criminal behavior and has still not complied with its own sector rules,” said Peter Shelley, senior counsel at the Conservation Law Foundation in Boston. “Anything they do is inherently suspect. Their collective behavior has undermined the whole sector system.
“Nothing in their behavior or attitudes either before Rafael was found out, or after, warrants any sympathy,” he said.
Others questioned why it took NOAA so long to act.
John Pappalardo, CEO of the Cape Cod Fishermen’s Alliance, which operates its own sector, said the agency’s delay had “created serious credibility questions within the fishing community.”
“This is a step that had to be taken to try to rebuild trust within the industry, and send the message that the government takes this seriously,” he said.
In a telephone interview, Bullard said the agency decided to wait to act after Rafael was sentenced. The order then had to go through an approval process before it could be issued.
Bullard acknowledged that the penalties will hurt some fishermen’s livelihoods. But he noted that the cooperative has still not provided a count of how many fish went unreported to federal regulators.
“I’m sure there will be an economic impact from this, but that’s something the sector should have thought about when they were failing to do their job,” Bullard said.
Until the cooperative presents a viable plan for reform and repays its debts for the uncounted fish, its vessels won’t be allowed to sail, Bullard said.
In New Bedford, city officials said they understood the need for federal officials to send a message but are worried about the consequences.
Mayor Jonathan F. Mitchell said he would have preferred that the agency had joined a “global settlement” that would have consolidated the penalties against Rafael in one ruling.
“The effect of not doing that has been to cause uncertainty with those who depend on the catch,” he said.
As a result, crew members who were not complicit in Rafael’s illegal enterprise will be out of work and dozens of businesses — from net menders to hardware stores and settlement houses that help fishermen with their accounting — will be affected.
“That hurts this time of year, especially when crews try to bring in more fish for the holiday market and bring home Christmas presents,” the mayor said.David Abel can be reached at email@example.com. Follow him on Twitter @davabel.