Rafael’s Boats and Permits Sought After

The forced sale of the fishing boats and permits of convicted New Bedford, MA felon Carlos Rafael continues to unfold. Some major players in the northeast fishing industry are circling what’s left of this multi-million-dollar industry holding. Rafael, aka The Codfather, was convicted in August of misreporting and underreporting his groundfish catch, income tax evasion and hauling suitcase loads of cash to a bank in Portugal. Part of the court settlement was the mandatory sale of the largest fleet of vessels and fishing permits in the U.S., which Rafael had accumulated over decades. Rafael is now serving a 46-month prison sentence.

A Blue Harvest Fisheries CEO is reported to have said his company signed a purchase and sale agreement for Rafael’s groundfish vessels. However, the New Bedford company Buyer and Sellers Exchange (BASE) has taken advantage of a Right of First Refusal. This Right of First Refusal allows members of Rafael’s former sector a chance to match or better a bid.

BASE was reported to have attempted to block the $46 million purchase of seven of Rafael’s scallop boats. The New Bedford fishing industry is interested in keeping Rafael’s vessels and permits a part of the New Bedford fleet. They are an important component in the port’s position as the nation’s largest port in dollars of landed product and its shore side infrastructure.

The Northwest Atlantic Marine Alliance (NAMA), a nonprofit that works with communities regarding fishing rights and defends against the corporate control of the ocean food network, sent a letter to NOAA on December 17. In that letter NAMA expressed objections to the sale of Rafael’s vessels and permits to Blue Harvest Fisheries. While NAMA objected to what it could mean for Carlos Rafael to profit from his crimes while in jail, they also expressed concerns that a hedge fund, Blue Harvest Fisheries, whose parent company is owned by a German-Dutch family, would control the groundfish fishery in the Northeast.

Rights of First Refusal are embedded in sector management policy as developed by NOAA Fisheries and the regional council system. NAMA has noted the trend toward privatization of the ocean and fisheries. Including the commoditization of the fishing industry enabling outside investors to come in and buy up quota and vessels.

Privatization and consolidation of ownership have been trending in other areas of the U.S. and world economy. The result is that owner operator fishermen can no longer afford access to fishing privileges and end up working for the people or investors who own the quota by leasing that quota. NAMA said it would prefer that the quota be divided among a diverse range of fishermen across New England.