Columbia seafood company head admits to labeling imported crab meat as local

Blue crabs have historically been North Carolina’s most valuable commercial fishery. [photo courtesy Hyde County/Megan Shaw]

The owner of a Tyrrell County seafood company pleaded guilty Tuesday to a federal charge of false labeling millions of dollars of crab meat from overseas as a “Product of USA”.

According to federal prosecutors, Phillip R. Carawan, owner, president and CEO of Capt. Neill’s Seafood Inc. in Columbia, told workers to label more than 179,872 pounds of crab meat with a retail market value of $4,082,841.

Between 2012 and June 2015, the company imported crab meat from South America and Asia, and then relabeled it as being from jumbo blue crabs caught locally.

The crab meat was then sold to wholesale clubs such as Costco and Sam’s Club and other retailers.

“Seafood mislabeling is consumer fraud that undermines efforts of hardworking, honest fisherman and the free market by devaluing the price of domestic seafood,” said Acting U.S. Attorney G. Norman Acker III for the Eastern District of North Carolina. “In this case, the fraudulent scheme artificially deflated the cost of domestic blue crab and gave Carawan an unacceptable economic advantage over law-abiding competitors.”

“Seafood fraud and mislabeling can affect the economic value of our domestic fisheries,” said Logan Gregory, Deputy Director of the U.S. Department of Commerce’s National Oceanic and Atmospheric Administration Office of Law Enforcement. “Our office is committed to investigating these crimes to help ensure the economic value and sustainability of our fisheries.”

As part of the plea agreement before U.S. District Judge Louise W. Flanagan in New Bern, Carawan admitted he and his company could not meet the demands of customers for domestic blue crab.

Restitution will be made to anyone the government confirmed purchased Capt. Neill’s jumbo crab meat between 2012 and June 16, 2015.

Customers who want to check to see if they qualify for restitution or for further information on the prosecution can visit https://www.justice.gov/usao-ednc/captneillsseafoodvictiminformationpage or http://justice.gov/largecases.

Sentencing will take place in January 2020. The maximum sentence for falsely labeling crab meat is five years in prison and a fine of up to twice the gross gain of the offense, which has been calculated at $8,165,682.00.

Separate charges against the company are still pending, and a hearing is set for Sept. 11.

This case was part of an ongoing effort by NOAA’s Office of Law Enforcement, in coordination with the Food and Drug Administration and the Department of Justice to detect, deter and prosecute those engaged in the false labeling of crabmeat.

About Sam Walker 216 Articles
Sam Walker is news director for OBXToday.com, Beach 104, 99.1 The Sound, 94.5 WCMS and Classic Rock 92.3. Reach him at sam@obxtoday.com

9 Comments

  1. Wow, what another loser. Shut this business down now. I dont care what you say there is absolutely no excuse for this. No more dealer license for this company. No more commercial fishing license for this company. Ncmf do you job now.

    • So the crabbing industry is booming but crab prices aren’t going down. And they’re going after this company because they bought crabs from somewhere else to get a lower price? Maybe they’re should be investigations in the industry as a whole.

      • John, as someone who fails to grasp the basics of the case, you should abstain from calling others “idiots”. Use all the self-control you can muster.

  2. What’s right is right. Caravan lies knowing labeling imported product like it was caught here hahaha shes getting what he deserves. And by the was I crab for a living so I’m appalled at this company’s greedy actions. That company isn’t supporting my(our intereats) they are supporting their wallet.

    • Indeed. US crabbers, fishermen, etc are already at disadvantage because they have to content with more rigorous environmental and food safety regulations. Labeling seafood caught elsewhere and in violation of such regulations (which makes the practice unsafe for consumers and marine ecosystems alike) undermines both US seafood industry and food safety. In fact we’d do well subsidizing local crabbing, fishing, etc industries through federal and state funding, as well as higher prices for locally caught seafood.

  3. What about restaurants around here who advertise “local” seafood knowing damn well it isn’t local? Are they held to the same legal standard?

  4. wrong is wrong and the company has admitted to it. Make the punishment fit the crime tho…did you read the possible punishment?? That punishment is absurd. We punish people who do wrong in the commercial fishing industry way more harshly than we do drug dealer and pedophiles….guess we blame that on Trump too….SMH!

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