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Sentencing Approaches for New England's 'Codfather'

Jul 23, 2017
Originally published on July 23, 2017 8:05 am

One of the biggest fishing magnates in the country could be sentenced to prison this coming week, and the forfeiture of his boats could be a big hit for the Massachusetts port where he amassed a small empire.

Between his scalloping and groundfishing boats, Carlos Rafael – nicknamed "the Codfather" — came to be the largest single owner of fishing vessels in New England, and possibly in the country.

But in 2015, undercover IRS agents posed as Russian criminals and convinced him they wanted to buy his entire fleet. Rafael unpacked an elaborate criminal enterprise to the agents — one he said he'd been carrying out for three decades.

Court records show that Rafael valued his business at $175 million. He told the undercover agents the value came from the way he cheated the government quota system. Rafael's men would haul in a more valuable fish — like cod — and report it as a cheaper species with a much greater quota. Now Rafael is facing prison time for counts including tax evasion and bulk cash smuggling — all of which he admitted to.

But people in New Bedford want to know: What will become of the 13 fishing boats — and all the permits attached to them — that were tied to Rafael's crimes? Will they be auctioned off on the open market, held by an entity such as the city of New Bedford or perhaps removed from circulation?

"I've been working for Carlos for 12 years now," says Richard Mauzerolle, who is in the spray foam business — he insulates holds on fishing boats owned by Rafael. He's one of hundreds of people in the area who work for Rafael.

"He's one of my main livelihoods right down in the area, so it'd be a shame to have him lose anything," Mauzerolle says. "He's brought this fishing industry back to where it was supposed to be down here."

Others have a less charitable take on Rafael. Brett Tolley, a community organizer with the Northwest Atlantic Marine Alliance in Gloucester, says the government should distribute the permits in a way that does not create a "Carlos 2."

"The level of consolidation and corruption and impact that Carlos Rafael has had has put fishing businesses out of business in Maine, New Hampshire, Massachusetts, Rhode Island, and you name it," says Tolley, who belongs to a fishing family dating back four generations.

"How his boats and permits get doled out, it's likely they will be consolidated into the hands of another Carlos Rafael. ... Our policymakers need to put in safeguards to ensure we do not have another too-big-to-fail scenario on the ocean."

Rafael is likely to hold onto his lucrative scalloping vessels, but 13 of his ground fishing boats are subject to forfeiture.

"Carlos Rafael is a scoundrel and he deserves to go to prison," says Jon Mitchell, who served as a federal prosecutor before becoming mayor of New Bedford. The city prides itself on having the most lucrative fishing port in the country. "The most important question right now is what happens to his permits."

According to Mitchell, Rafael's business represents 75 percent of the city's groundfish by value. Mitchell wants port officials in New Bedford to control Rafael's permits. That would keep his boats and all of the jobs in the city. But the permit could end up being put up for auction to the whole of the Northeast.

It'll be up to a federal judge in Boston to decide the fate of Rafael's fishing empire, on the same day he issues his sentence.

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LULU GARCIA-NAVARRO, HOST:

A fishing mogul known as the Codfather could be sentenced to prison this week for tax evasion and smuggling. Carlos Rafael built a small empire in New Bedford, Mass., and the confiscation of his boats would deliver a harsh blow to the port town. As member station WBUR's Simon Rios reports, both friends and foes want his businesses to stay.

GARCIA-NAVARRO: Between his scalloping and ground fishing boats, Carlos Rafael came to be the largest single owner of fishing vessels in New England and possibly in the country. But in 2015, undercover IRS agents posed as Russian criminals and convinced him they wanted to buy his entire fleet. Rafael unpacked an elaborate criminal enterprise to the agents - one he said he'd been carrying out for three decades. Rafael hasn't spoken to reporters of late. But in 2004, he told an archivist that the future of the fishing industry would be for those with enough money to invest in different types of boats.

(SOUNDBITE OF ARCHIVED RECORDING)

CARLOS RAFAEL: It's a future for guys with deep pockets. I can diversify. I got the draggers. I got the scallopers (ph). I have alternatives. But the guy that only got one boat, he's in trouble.

SIMON RIOS, BYLINE: Now Rafael is the one in trouble. Court records show he valued his business at $175 million. He told the undercover agents the value came from the way he cheated the government quota system. Rafael's men would haul in a more valuable fish, like cod, and report it as a cheaper species with a much greater quota. Now Rafael is facing prison time for counts including tax evasion and bulk cash smuggling - all of which he admitted to.

But people in New Bedford want to know what will become of the 13 fishing boats and all the permits attached to them that were tied to Rafael's crimes?

RICHARD MAUZEROLLE: I've been working for Carlos for 12 years now.

RIOS: Richard Mauzerolle sprays foam insulation in the fish holds of Carlos Rafael's boats. He's one of hundreds of people who worked for Rafael.

MAUZEROLLE: He's one of my main livelihoods right down in the area. So it'd be a shame to have him lose anything. You know, he's brought this fishing industry back to where it's supposed to be down here.

RIOS: Rafael is likely to hold on to his lucrative scalloping vessels. But 13 of his ground fishing boats are subject to forfeiture.

Poseidon is one of them. Destiny is one. Those are subject to forfeiture.

I met former fisherman Jim Kendall on a dock in New Bedford, where Rafael keeps several of his boats.

So it's all the ones painted green with a CR, Carlos Rafael, inside a circle. That's his logo.

JIM KENDALL: Yeah. That's his logo (laughter). I've known Carlos for years. And I think he loves nothing better than challenging.

RIOS: For much of Rafael's career, the challenger has been the U.S. government. But this time, the government has the upper hand.

JON MITCHELL: Carlos Rafael is a scoundrel. And he deserves to go to prison.

RIOS: Jon Mitchell was a federal prosecutor before becoming mayor of New Bedford. The city prides itself on having the most lucrative fishing port in the country.

MITCHELL: The most important question right now is, what happens to his permit?

RIOS: Mitchell wants Port officials in New Bedford to control Rafael's permits. That would keep his boats and all of the jobs in the city. But they could be put up for auction to the whole of the Northeast. It'll be up to a federal judge in Boston to decide the fate of Rafael's fishing empire on the same day he issues his sentence. For NPR News, I'm Simon Rios in Boston.

(SOUNDBITE OF RATATAT SONG, "LOUD PIPES") Transcript provided by NPR, Copyright NPR.