CAVIAR COMPANY AND PRESIDENT CONVICTED IN SMUGGLING CONSPIRACY

Gourmet Food Retailers Got Counterfeit And Doctored Caviar For New Year 2000

GREENBELT, MD – The Justice Department's Environment and Natural Resources Division announced today that Alfred Yazback, president and owner of Connoisseur Brands Ltd., will serve time in prison and pay fines for conspiring to smuggle protected sturgeon caviar and making false statements to the U.S. Fish and Wildlife Service (FWS), as well as selling counterfeit caviar to retail food companies with false labels in violation of the Lacey Act, a wildlife protection statute.

Yazback, 47, the president and owner of New York-based caviar company Connoisseur Brands will serve two years in prison, pay a $26,404 individual fine and pay $23,596 restitution for unpaid custom duties for caviar smuggled into the country using false double invoices that minimized the value. Connoisseur Brands will pay a criminal fine of $110,000, which includes a community service payment of $25,000 to the Fish and Wildlife Foundation for the preservation and restoration of Sturgeon and American Paddlefish in Maryland and the United States.

"Smuggling wildlife, especially protected species with questionable futures, is a serious crime," said Thomas L. Sansonetti, Assistant Attorney General for the Department of Justice Environment and Natural Resources Division. "This case highlights that domestic sturgeon species and Paddlefish are protected by the same laws that protect sturgeon in the Caspian Sea. The Justice Department is dedicated to enforcing the laws designed to protect and preserve protected species to ensure their survival."

Yazback was caught in "Operation Malossol" a covert operation in which a FWS special agent posed as a buyer with Sutton Place Gourmet in Rockville, MD. The undercover agent, in cooperation with Sutton Place, purchased caviar from Connoisseur Brands, which was then DNA tested by the FWS National Forensics Laboratory in Oregon. The DNA results showed that the vast majority of Russian Sevruga caviar – one of three types of commercially available caviar – purchased from Connoisseur was in fact fish eggs from the American Paddlefish, a protected species indigenous to the United States and found in the Tennessee and Mississippi Rivers. While Paddlefish roe has less commercial value, when processed it is sufficiently similar in appearance that it can be "passed off" to the uninformed consumer as Sevruga caviar from the Caspian Sea.

In a signed statement filed in Court, the defendants admitted to the following:

• Selling counterfeit caviar labeled as "Product of Russia." Yazback and Connoisseur Brands sold customers counterfeit caviar using protected American Paddlefish in jars and tins labeled as Russian caviar. Customers included Balducci's, Dean & Deluca, Harry & David and Trader Joe's.
• Purchasing caviar out of suitcases smuggled into the U.S. Yazback purchased caviar out of luggage and suitcases delivered to his warehouse by Eugene Koczuk, who has been convicted for smuggling caviar into the country in luggage with the use of paid couriers. Some of Koczuk's smuggled caviar was shipped to Dean & Deluca customers, even though Yazback had reviewed a Dean & Deluca gourmet catalogue entitled "Holiday 1999" which advertised, "New regulations made finding impeccable Beluga caviar tantamount to seeking the Holy Grail this year. We got lucky."
• Selling black market caviar to food retailers. Some of the caviar may not have received proper refrigeration at some point, so Connoisseur Brands engaged in various practices to "dress it up" for sale. The company used a process known as "caviar washing" which entailed defrosting frozen caviar, draining it of oil, washing it with salt water, adding walnut or hazelnut oil to disguise spoilage, bad smell or taste and then partially pasteurizing the roe.
• Smuggling caviar into the U.S. using false "double" invoices. Yazback and Connoisseur Brands used a double invoicing scheme that concealed the higher actual purchase cost of the caviar from U.S. Customs so as to minimize import duties and to conceal hidden tins of Beluga caviar, which were more valuable and scarce due to the endangered status of Beluga sturgeon.
• Selling illegally caught Paddlefish. Some of the thousands of pounds of Paddlefish roe purchased by the defendants and used for substitutions was caught illegally. In particular, some was obtained from an undercover Alabama State conservation Officer working with the Fish & Wildlife Service. In one tape recorded conversation in 1999, he told the undercover agent he wanted to purchase American caviar (Paddlefish roe) for years to come since, "I think that's the score to be made over the next five or six years."
• Making false statements to the U.S. Fish & Wildlife Service. Yazback asked the undercover agent posing as an illegal fisherman for false documents so he'd have the necessary papers to apply for export permits from the FWS. The requested documents falsely stated that this source had sold Yazback 534 pounds of roe from the Shovelnose Sturgeon, a protected species in the United States also known as Hackleback, and planned to sell another 4,000 pounds, when Yazback had only purchased 10 pounds. The agency refused to grant the export permit after calculating that to total 4,534 pounds of Shovelnose Sturgeon roe would require killing between 68,010 to 170,025 fish.

The case was investigated by the U.S. Fish & Wildlife Service and the FBI, with assistance from the U.S. Customs Service, and prosecuted by the DOJ Environment Division in coordination with the U.S. Attorney's Office for Maryland.

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