Virginia seafood dealer banned from importing food for the next 20 years

Dec 14 2009

A Virginia man sentenced to five years in prison for his role in a conspiracy to import catfish from Vietnam for fraudulent sale to avoid paying federal import tariffs has been barred from importing articles of food or offering such articles for import into the United States for the next 20 years, the U.S. Food and Drug Administration said today.

This action represents the agency's first debarment of a food importer. Peter Xuong Lam, president of Virginia Star Seafood Corporation of Fairfax, Va., participated in a conspiracy to sell frozen catfish fillets falsely labeled as sole, grouper, flounder, snakehead, channa, and other species of fish to avoid paying federal import tariffs. None of the species names used by Lam and his co-conspirators to falsely label the fish, aresubject to federal tariffs.

Under current law, the FDA may debar a person from importing an article of food or offering such an article for import into the United States if that person has been convicted of a felony for conduct relating to the importation into the United States of any food. The law also provides that the FDA may debar a person if that person has engaged in a pattern of importing or offering for import adulterated food that presents a threat of serious adverse health consequences or death to humans or animals. The statute allots the agency up to five years to take such action.

Lam was convictedby U.S. District Judge Philip S. Gutierrez for the Central District of California of four felony counts relating to the importation into the United States of food, and is prohibited from importing articles of food or offering such articles for import into the United States, and others are prohibited from importing food with Lam's assistance or under his direction, for the next 20 years.

In addition to his prison sentence, the court ordered Lam to forfeit more than $12 million to reimburse the government for anti-dumping duties.

"The FDA will use its debarment authority to protect the safety and integrity of the American food supply," said Michael Chappell, acting associate commissioner for regulatory affairs.

The conspiracy involved more than 10 million pounds of frozen catfish fillets from Vietnam. DNA tests revealed that the frozen fillets in the Lam case were in fact Pangasius hypophthalmus, a fish in the catfish family that may be marketed under the names Swai, Sutchi, Tra or Striped Pangasius.

An anti-dumping duty was placed on Pangasius hypophthalmus imports from Vietnam in January 2003, after a petition was filed by U.S. catfish farmers, who said the fish were being imported from Vietnam at less than fair market value.

To date, 12 individuals and companies have been convictedof criminal charges related to the scheme to avoid paying import tariffs by falsely labeling fish for import and then selling it in the United States at below market price. The organizer of the smuggling conspiracy, Nhan Huhn Dat (aka Henry) Nguyen, remains a fugitive and is believed to be living in Vietnam.

The case was investigated by Special Agents of the FDA's Office of Criminal Investigations; the National Oceanic and Atmospheric Administration, Fisheries, Office of Law Enforcement and U.S. Immigration and Customs Enforcement.