A Mississippi seafood distributor and two company managers pleaded guilty today to conspiring with others to mislabel seafood and commit wire fraud by marketing inexpensive and frozen imported substitutes as more expensive and premium local species.
Quality Poultry and Seafood Inc. (QPS), the largest seafood wholesaler on the Mississippi Gulf Coast, has agreed to pay the United States $1 million in forfeitures and a criminal fine of $150,000. QPS sales manager Todd A. Rosetti and business manager James W. Gunkel, both of Ocean Springs, Mississippi, also pleaded guilty to misbranding seafood to facilitate QPS’ fraud.
QPS admitted to participating in this fish substitution scheme from as early as 2002 and continuing through November 2019. The indictment alleges that QPS recommended and sold to its restaurant customers foreign-sourced fish that could serve as convincing substitutes for the local species the restaurants advertised on their menus. QPS also labeled the cheap imports that it sold to customers at its own retail shop and café as premium local fish.
“QPS and company officials went to great lengths in conspiring with others to perpetuate fraud for more than a decade, even after they knew they were under federal investigation,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “Mislabeling seafood harms local wholesalers and fishermen who compete to sell locally sourced, premium fish in a market unfairly flooded with less expensive fish, frozen and imported from overseas.”
“When imported substitutes are marketed as local domestic seafood, it depresses the value of authentic Gulf Coast seafood, which means that honest local fishermen and wholesalers have a harder time making a profit,” said U.S. Attorney Todd W. Gee for the Southern District of Mississippi. “This kind of mislabeling fraud hurts the overall local seafood market and rips off restaurant customers who were paying extra to eat a premium local product. These convictions should serve as a warning: restaurants and wholesalers will face criminal prosecution if they are not honest with customers about what they are actually buying.”
“U.S. consumers expect their seafood to be correctly identified. When sellers purposefully substitute one fish species for another, they deceive consumers and cause potential food safety hazards to be overlooked or misidentified by processors or end users,” said Special Agent in Charge Justin Fielder of the Food and Drug Administration (FDA)’s Office of Criminal Investigations, Miami Field Office. “We will continue to investigate and bring to justice those who put profits above public health.”
The indictment alleges that even after agents from the FDA executed a criminal search warrant at QPS to investigate its sale of mislabeled fish, QPS continued for over a year to sell frozen fish imported from Africa, South America, and India for use as substitutes for local premium species.
Mary Mahoney’s, which pleaded guilty in May, admitted that between December 2013 and November 2019, it fraudulently sold approximately 58,750 pounds (over 29 tons) of fish that was not the species identified on its menu. QPS supplied seafood to Mary Mahoney’s and many other restaurants and retailers.
QPS, Rosetti, and Gunkel will be sentenced on Dec. 11. A federal district court judge will determine any sentence after considering the U.S. Sentencing Guidelines and other statutory factors.
FDA’s Office of Criminal Investigations is investigating the case.
Senior Trial Attorney Jeremy F. Korzenik of the Environment and Natural Resources Division’s Environmental Crimes Section and Assistant U.S. Attorney Andrea Jones for the Southern District of Mississippi are prosecuting the case.