U.S. king crab importer jailed

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Money laundering, poaching charged, Russian press says

November 16, 2007|By Hal Bernton | Hal Bernton,The Seattle Times

SEATTLE -- Arkadi Gontmakher earned a fortune bringing Russian king crab to the American consumer.

His eight-year-old Bellevue, Wash., company, Global Fishing Inc., sold $148 million in seafood last year. And Gontmakher, an American citizen from Ukraine, has lived in high style, driving a Bentley and building a red-brick mansion atop a Bellevue hill.

In late September, Gontmakher was arrested and jailed in Moscow. He is accused of money laundering and participating in a poaching operation that illegally exported millions of pounds of king crab to the United States, according to reports in the Russian press.

These allegations have cast a shadow on the king crab markets just as the peak holiday sales season approaches.

Global Fishing is the largest U.S. importer of the Russian product, its crab sold in grocery stores across the country. But some U.S. industry officials report a new wariness about buying Russian product. And, at a time of international concern over declining fish stocks, Gontmakher's arrest underscores the challenges of sorting out legally caught from illegally caught seafood.

"It is very, very hard to trace a seafood product, and know everything about where it came from," said Jeff Lyons, a senior vice president at Costco Wholesale Corp., which sold Global Fishing crab legs in the past but no longer buys from the company.

Global Fishing officials, in a statement released to The Seattle Times, say the company "has always sought to operate in a legal and ethical manner," and their 30-person business remains strong. They say all their crab has full documentation to the point of purchase, and has been inspected and cleared by Russian and U.S. agencies.

"We will continue to serve all our customers as fully as possible," the statement said. "Arkadi's family and colleagues are understandably shocked and suffering a great deal of emotional distress over Arkadi's continuing and unjustified detention by Russian authorities."

Russian king crab has flooded U.S. markets in the past decade, driving down prices to the dismay of Alaska crabbers and to the benefit of crab-loving consumers.

Gontmakher is the largest of those importers. In the first six months of this year, his company brought in 20 million pounds of Russian king crab - an amount roughly equal to this year's entire Alaska red king crab harvest, according to the Urner Barry Foreign Trade Database.

Gontmakher created Global Fishing in 1999, building it on the foundation of another firm that exported poultry and other products to Russia. Global imports crab from the Russian Far East, where the freewheeling aftermath of the fall of communism brought a major escalation in unregulated harvests.

As Global's chief executive officer, Gontmakher has led a well-bankrolled, fiercely competitive operation that has offered some of the cheapest crab around.

"He rose very quickly, and everyone was always questioning where his money came from," said John Sackton, editor of Seafood.com News. In the Puget Sound area, where millionaires often dress in blue jeans, Gontmakher, 50, cut an elegant figure in his tailored suits. To celebrate his birthday this year, he held a big bash in Las Vegas.

Gontmakher's arrest comes amid President Vladimir V. Putin's broader push to reassert Moscow's control over natural resources. Some believe the arrest may also have political undertones as the government seeks to reward supporters and to crack down on businesspeople who have fallen out of favor.

Seafood.com editor Sackton said that Gontmakher, as an American businessman with Ukrainian roots, might have made a tempting target for Russian nationalists.

Global Fishing officials say the company does not catch its own crab but buys from other fishing companies.

The Russian government alleged that Gontmakher conspired with two Russians, Aziz Embarek and Alexander Suslov; they are officials of Eastern Fish Resources, which operates a fleet of crab vessels. The three men are accused by the Russian government of moving some $200 million worth of poached seafood out of Russia.

Calls to Russian government officials in Washington and Moscow for comment on the arrests were not returned.

U.S. Embassy officials in Moscow, noting privacy rules, declined to comment on the case or say whether they had visited Gontmakher.

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