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Down on the docks of the Whaling City, everyone knows him as "Carlos."
"I've been working for Carlos for 12 years now," says Richard Mauzerolle of Weston. "Sometimes he should watch out who he's talking to," he adds with a laugh, referencing the IRS sting that landed Carlos Rafael guilty on 28 counts in late March. "But he's a good guy."
The fall of New Bedford fishing boss Carlos Rafael could be a big blow for the city's port. And if his fishing permits are forfeited and end up in another state, it could hurt Massachusetts as a whole.
What happens to Rafael's boats — and the permits attached to them — will be decided by a federal judge. And people in New Bedford want them to stay in the city.
'He's One Of My Main Livelihoods'
Mauzerolle is in the spray foam business — he insulates holds on fishing boats owned by Rafael. He's one of hundreds of people who work with the man known as "the Codfather," who gives Mauzerolle about a third of his business.
"He's one of my main livelihoods right down in the area, so it'd be a shame to have him lose anything," says Mauzerolle, standing in front of his box truck with a massive Donald Trump sign stuck to the side. Rafael, he says, has "brought this fishing industry back to where it's supposed to be down here."
In 2004, Rafael spoke to an archivist at the Working Waterfront Festival in New Bedford about how he amassed so many boats, highlighting the importance of diversifying between scallops and groundfish.
"It's a future for guys with deep pockets," he said. "... I can diversify. I got the draggers, I got the scallopers. I have alternatives. But the guy that only got one boat, he's in trouble, he's in a lot of trouble."
Rafael's business savvy led him to the captain's chair of the New England fishing industry -- his groundfishing fleet buoyed by his lucrative scalloping boats — but now he's the one in trouble. In 2015, court documents show he tried to sell his entire fleet to undercover IRS agents posing as Russian criminals, for $175 million.
Reached by phone, Rafael refused to comment for this story, but he spoke in depth to the federal agents who set him up.
Federal court filings show Rafael outlining an elaborate criminal enterprise over 30 years. "The dance," as Rafael called it, involved mislabeling fish caught by his boats to cheat the quota system that regulates the fishing of species like cod and haddock.
Rafael faces a few years in prison for tax evasion, bulk cash smuggling, two counts of falsifying a federal record, and 23 counts of false labeling and identification — all of which he pleaded guilty to in March.
But the big question for many is what will become of the 13 fishing draggers connected to Rafael's crimes -- whether they will be auctioned off on the open market, held by an entity such as the city of New Bedford, removed from circulation, or somehow kept in the Rafael family.
Others have a less charitable take on the 65-year-old Azorean. 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."
The National Oceanic and Atmospheric Administration — along with the Justice Department — will have a hand in deciding what becomes of the permits. NOAA's top official in the northeast, John Bullard, said: "Because it's a case that's in process, I'm not going to comment on it."
The Options For Rafael's Fishing Permits
"Carlos Rafael is a scoundrel, and he deserves to go to prison," says Jon Mitchell, who was a federal prosecutor before becoming mayor of New Bedford, which is home to the country's top-grossing fishing port.
The most important question now, Mitchell says, is what happens to the permits and the fish. But the mayor puts the significance of the 13 vessels into perspective.
"Less than 10 percent of the value of the annual landings of the port of New Bedford come from groundfish these days," he says. "The groundfish industry has contracted significantly on the East Coast, as everybody knows, and what's left of it is concentrated in New Bedford, but its overall share of the landings in the port are quite small."
According to Mitchell, Rafael's business represents 75 percent of the city's groundfish by value. But it's only about 7 percent of the port's total landings, most of which come from scalloping boats.
Mitchell wants the port to be diversified, however, and Rafael's groundfishing fleet is a key part of that. Mitchell says he would like to see Rafael's permits under the control of the New Bedford port authority, the Harbor Development Commission, "a neutral body that could hold and lease out the permits."
Mitchell says Rafael could also sell his permits to other boat owners in the port and use the proceeds to pay off his forfeiture obligations.
Fisherman Willis Blount is based in Nantucket and sells roughly half of his landings in New Bedford. With Rafael possibly headed to prison — and the fate of his permits up in the air — Blount says the whole New Bedford industry stands to lose.
"The price of fish is going to drop," Blount says. "The volume is not going to come in."
Specifically, Blount says people like him could suffer in two ways.
"As the amount of fish landed gets shrunk, the clout that the buyers have shrinks, so they're not able to pay as much money because... they have less leverage on the people they're selling the fish to," Blount says.
Then there's Rafael's sheer negotiating power. Blount says because of the size of Rafael's business, he is able to influence the price New England fishermen pay to lease shares of fish from permit holders. Blount says that last year Rafael negotiated the price of codfish low enough so fisherman could actually make a profit selling it.
"He blessed everybody by doing it."
Tor Bendiksen runs one of the last firms in New England that make fishing nets, Reidar's Manufacturing.
"Here in the New Bedford dragging industry, [Rafael] is our No. 1 customer," Bendiksen says, adding that he services 17 draggers owned by Rafael.
"From a business perspective, if you lose a big portion of your customer base in an instant fashion like that, you sort of take a big step backwards. You have to regather yourself as a company."
Bendiksen says his business has shifted away from groundfish and toward scallops. But the loss of Rafael's business could force him to lay off some of his 10 employees.
"It's a big hurting to a business that's already been suffering," he says. "Our groundfish industry has been suffering for almost 30 years now."
This segment aired on April 11, 2017.
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