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We’re from the government and we’re here to shake you down

Nils E. Stolpe

July 12, 2010 (modified on July 13)

Fishermen and people in fishing-dependent businesses had been complaining for years about the heavy-handed and arbitrary “justice” that was meted out by the enforcement arm of the Department of Commerce’s (DOC’s) National Oceanic and Atmospheric Administration (NOAA). Their complaints generally had to do with vindictiveness, pettiness and coercion, and ranged from the enforcement agents “on the street” to the administrative law judges that heard the cases. In the spring of 2009, bombarded with what seemed to be an ever-increasing number of complaints from their constituents, legislators from the US Congress and the Commonwealth of Massachusetts demanded that the troubled relationship between the fishing industry and the federal agencies responsible for policing it be examined.

This resulted in Todd Zinser, the Inspector General of the DOC, launching an internal investigation of the NOAA Offices of Law Enforcement (OLE) and General Counsel for Enforcement and Litigation (GCEL). Note here that while Jane Lubchenco, the current head of NOAA, has insisted the this investigation moved forward at her “urging,” those of us who have been closely following the evolution of what can’t be seen as anything less than a full-blown scandal know that it began only as the result of significant bipartisan pressure on her and the Secretary of Commerce. Quoting from the memo from the Inspector General to Ms. Lubchenco on January 21, 2010 accompanying the report on his preliminary investigation “your memorandum reiterated concerns raised by members of Congress and elected state officials about reports of heavy-handed and unfair enforcement…”

Inspector General Zinser’s report ( was damning in its own right. Among a slew of other problems, this internal investigation revealed that while virtually all of the cases brought by NOAA against fishermen and people in fishing dependent businesses were noncriminal in nature (98%), its investigative workforce was overwhelmingly trained in and oriented to criminal investigations (90%). It also disclosed a so-called Asset Forfeiture Fund (AFF) with an estimated balance of $8.4 million and that “OLE officials are not aware of the fund’s having ever been audited.”

The Office of the Inspector General (OIG) investigation was summed up with “in short, we found systemic, nationwide issues adversely affecting NOAA’s ability to effectively carry out its mission of regulating the fishing industry. These issues have contributed significantly to a highly-charged regulatory climate and dysfunctional relationship between NOAA and the fishing industry…”

One of the recommendations of the OIG was a forensic review of the AFF. This review was in part accomplished by the international accounting firm KPMG. Of this review of AFF transactions, the OIG wrote “though it did not identify many anomalous transactions, KPMG was limited to, and relied on available supporting documentation, and did not carry out additional inquiries beyond review of existing records to identify evidence of potential irregularities.”

Regarding the paucity of existing records to identify evidence of potential irregularities, on March 4 the New York Times reported “House Oceans and Wildlife Subcommittee Chairwoman Madeleine Bordallo (D-Guam) said that NOAA Law Enforcement Director Dale Jones should be at least temporarily relieved of his duties, given questions over whether he may have tried to destroy documents to avoid an even more scathing report from the Commerce Department's top investigator. ‘As the top cop at NOAA and a longtime investigator himself, Dale Jones must be acutely aware that shredding documents during a federal investigation raises serious questions about his commitment to a full and fair look at all the facts,’ Bordallo said at a subcommittee hearing on the issue yesterday.' At a time when transparency and accountability in the way our government operates is of utmost importance, this type of behavior cannot be condoned, and Mr. Jones should step aside until the IG's investigation is completed.”

Due to missing - and possibly intentionally shredded - records, the OIG reported that it was “unable to verify the $8.4 million balance provided by OLE and NOAA’s Office of Finance, as cited in our January 2010 report. KPMG’s analysis suggests that the AFF’s current balance likely falls within a broader range. Based on complicated definitional, data analysis, and reconciliation efforts, KPMG found that during the period of its forensic review (January 1, 2005, through June 30, 2009), the AFF received approximately $96 million (including interest on prior balances), while expending about $49 million through over 82,000 transactions. This analysis suggests that the balance could be much higher than $8.4 million.”

Bear in mind that, as the name Asset Forfeiture Fund indicates, these tens of millions of dollars weren’t from federal taxes. They were from fines and seizures imposed on fishermen and on owners and employees of fishing-related businesses.

And how was the Asset Forfeiture Fund misused?

The KPMG review disclosed:

So we have a bunch of criminal investigators in the position of paying for their unauthorized cars, boats, and international junkets and questionable “covert” operations by apprehending fishermen for noncriminal activities. And the controls on how they spent the money, once they lifted it out of the fishermen’s pockets in administrative proceedings that seem more “kangaroo court” than anything else, was apparently not being controlled, or even noticed, by anyone. Having spent 15 or so years in government, I find it impossible to imagine that anyone I worked with would have considered, or been allowed to carry out, the fiscal maneuvers that were evidently standard operating procedure in NOAA.

Kind of amazing, isn’t it? Even more amazing was - and as far as I know, still is - the reaction of NOAA to what should go down in history as the most shameful episode in the 40 year existence of the Agency. Congressman John Tierney has on his website an article by Gloucester Daily Times reporter Richard Gaines that says in part “members of the East Coast congressional fishing caucus are prepared to challenge the announced intention of top fisheries regulators to tackle systemic failings in law enforcement — including excessive penalties and possible vindictive motives — without reviewing past miscarriages of justice by federal enforcement agents against fishermen and related businesses.” The source was a memo from Lois Schiffer, Chief Counsel of NOAA, and Eric Schwaab, NOAA Assistant Administrator for Fisheries, to NOAA Administrator Lubchenco.

The financial loss that people suffered at the hands of this out-of-control NOAA police force was huge. Has there been or is there going to be an accounting? How many people lost their boats, their businesses, their homes, their very way of life because they were targeted by criminal investigators in search of crimes to prosecute and with a growing inventory of crime-stopping toys like new SUVs and “undercover” yachts to “protect the fish” with? And when the investigators couldn’t find any real crimes to stop with their wrongfully acquired toys, they manufactured them out of petty reporting and paperwork violations in an enforcement system that had become really adept at suffocating fishermen with an avalanche of largely irrelevant paperwork years ago.

NOAA is sitting on a large pot of money which was taken from fishermen and other business people through what it’s hard to see as anything but strong-arm tactics. NOAA has also let another large pot of money from those same fishermen be improperly spent without adequate safeguards and/or supervision. But the NOAA leadership seems intent on fixing the corrupt enforcement system that it allowed to fester for so long with no concern for the victims of what was at best their inattention and at worst their active encouragement. Since this whole sordid affair started, how many dollars went to the salaries of NOAA administrators who were looking the other way when their responsibilities should have included oversight of these two renegade offices? How many of those administrators are still there (or are retired and collecting government pensions)? And more importantly, what were the total costs to the people and the businesses that were so wrongfully prosecuted - and persecuted - because of this pervasive blind spot that they conveniently developed?

Are Ms. Lubchenco and the rest of the NOAA/NMFS leadership proposing to ignore all of this? I really hope not, but if that’s the case, it’s up to all of us to make sure that Congress steps in post haste.

In a NY Times article following her appointment to head NOAA, Jane Lubchenco said “fishing communities, scientists, regulators and other stakeholders in the debate need to overcome a legacy of bitterness and distrust. ‘It really is pretty dysfunctional’” Unless and until she convincingly turns her agency’s enforcement efforts around, sees that agency personnel who committed or allowed to be committed the many infractions reported by the OIG and KPMG are appropriately punished, and willingly makes adequate restitution to the fishermen and others who were so unnecessarily and vindictively damaged by her agency’s actions, she’ll be doing nothing but adding to what has now become her very own legacy of bitterness and distrust, and the level of dysfunction is only going to increase. Some bureaucratic reshuffling isn’t going to do the job that needs to be done.

•       On July 1, North Carolina Congressman Walter Jones introduced H. R. 5668, “to amend the Magnuson-Stevens Fishery Conservation and Management Act to require the use of sums received as fines, penalties, and forfeitures of property for violations of that Act or other marine resource laws to be used to reduce the Federal deficit and debt.”

•       On July 8, Massachusetts Congressmen Barney Frank and John Tierney publicly called for Jane Lubchenco’s resignation.

•       On July 9, North Carolina Congressman Walter Jones demanded that Jane Lubchenco step down as head of NOAA.

•       On July 9, Congressman Frank, after communicating with the Obama Administration, backed away from his demand that Ms. Lubchenco resign, pending indications that she would become more responsive to the fishing industry. (For the Gloucester Times’ take on this issue, see

•       On July 12, New York Senator Charles Schumer demanded that NOAA sell unauthorized assets, return proceeds to fund, and return arbitrary and excessive fines to fishermen who committed no wrong doing or were excessively fined.