Part 2 - Southeast Alaska Fish Rights Robbed:

Common Law Conspiracy Achieved Early Control

State House Bill 286 Already Underway:

By Victor Smith

"Prior to taking any action?" What SEAS' February 2002 newsletter didn't tell their membership was that Zuanich, Bedford, and Thorstenson had already taken action, starting right after the November 2001 meeting. Working through November and December, they filed their own fleet reduction legislation, State of Alaska House Bill 286, on Friday January 4, 2002, a full month before they announced it to their membership in the Brailer Scoop. (I gave testimony on HB 286 to the Senate Judiciary Committee in the spring of 2002.)

It was likely no coincidence that salmon processors had been in meetings in Anchorage on January 2nd thru the 4th. Immediately after SEAS' November 2001 meeting, influential processor spokesmen had expressed concern seiners might seek fleet reduction on their own terms. Other plans were afoot. Through the remainder of 2001, these "industry spokesmen" drew up white papers for the processors' Anchorage meeting proposing salmon industry "restructuring" using the model of Senator Ted Stevens' American Fisheries Act for pollock ratz.

It was probably no coincidence either that HB-286 would have been the perfect state vehicle for implementing the model proposed by the processors' white papers, particularly if "incentives" had been added to the bill just as UFA and the Salmon Task Force (chaired by Ben Stevens) proposed, almost immediately after the bill's passage.

Could Zuanich, Thorstenson, and Bedford have been working in cahoots with processors on HB-286? Could Ben Stevens, Advance North, even Trevor McCabe have been in on it?

Crowing that they had cooked up HB 286 to "meet the expectations of their memberships," Zuanich and Thorstenson gave excuses for why they had abandoned a NMFS managed program and come up with their state bill, first by claiming that there had to be a conservation reason to use the Federal plan. To cut off discussion of the NMFS plan they secondly threatened that even applying for the federal plan might signal certain environmentalist foes that there were conservation issues in the S. E. salmon fishery.

Their second excuse was that the Federal plan required all reduced permits to be permanently extinguished, making it incompatible with Alaska's requirement that more permits could be issued later, say if a fishery rebounded to where it was viewed as too exclusive.

All that was needed to reconcile the state and federal plans was a simple fix to protect a buyback's equity by specifying that if new permits were issued in a reduction fishery, the program would be reimbursed for the buyback's reduction cost of that many previously retired permits. That way, the permit holders staying in the fishery wouldn't be taxed for permits that weren't going to permanently stay retired.

Even though this simple fix would be an obvious requirement of any State plan-a fix that has since been implemented-Zuanich, Thorstenson, and Bedford claimed such reconciliation of the State and Federal plans was impossible.

After the processors met in Anchorage, many fishermen began receiving notices they wouldn't have a market for their fish in the 2002 season. By spring of 2002, nearly half the Southeast seine fleet-almost entirely non-Alaskan boats-had been told by their processors that they didn't have salmon markets. Some fishermen were even advised they should just quit because all alternative markets were going to be utilized by existing processors.

Simultaneous to the developing salmon market shortage, Global Seafoods, at that time a significant Russian fish processor (now U.S. based), applied to process salmon in the Southeast archipelago for the 2002 salmon season.

Incredibly, SEAS and PSVOA betrayed half the seine fleet when they turned up their noses at Global and refused to support the one processor that could have supplied markets to most of the cut boats. It is also worth noting that after all was said and done, in the 2002 season it was Thorstenson and a small group of his friends that seine caught a bunch of over ripened fish-salmon that was rejected by all the other Alaskan processors-for Smoky Foods, who delivered them 200 miles off shore to Global's floating processor. That fish was described by one of the tender men involved as being unfit for cat food. And there is some evidence that in 2003 Thorstenson may have attempted to use the unhappy resolution of those sales to impair or discredit Global again.

In April, 2002 I stepped forward with allegations that Zuanich, Thorstenson, and Bedford had agreed not to support Global Seafoods as part of a deal they had made with traditional processors in exchange for those processors' support for passage of the HB 286 fleet reduction scheme.

My suspicion is that processor support for HB 286 was more than just political; that "support" also included an agreement-worked out in the last months of 2001-that the processors would also deny markets to half the seine fleet in 2002. The ensuing market shortage would create an air of futility and a cheap pool of unusable permits with no option other than to sell out to the buyback program controlled by the half of the fleet that still had markets.

As utterly malfeasant as rejecting more seine markets was under the circumstances, I believe doing so as part of a deal with the processors was of criminal intent and motive.

SEAS Retains Markets for Its Members:

Thorstenson used the same 'divide and conquer' tactics with the seiners that he used as UFA president for crab ratz. If the seine associations had responded as they should have, and stood up to the processors in a unified front, protesting fishermen wouldn't' have felt individually threatened. But Thorstenson, a significant stock holder in Icicle Seafoods, was under absolutely no threat whatsoever of losing his salmon market. Disingenuously, he warned other seiners not to speak out about low prices or other conditions when he ludicrously claimed that, "like the rest of them, even [he] was fearful of losing his market."

When confronted with these points, Dave Bedford dismissively minimized their significance by saying that SEAS-the association tasked to administer the present buyback that then (as now) only represented about a quarter of the permit holders-was "only acting in the best interests of its membership."

That was a convenient truth, because all SEAS directors and members retained markets, and it was obviously beyond coincidence that none of them had been cut. Certainly SEAS directors thought its members would benefit from eliminating half their competition. So, to eliminate the other half of permit holders they only had to go along with the deal that Thorstenson, Zuanich, and Bedford had proposed to them.

After Thorstenson, Zuanich, and Bedford suckered their boards into becoming accomplices in the scheme to eliminate industry competition, the processors predictably turned on the seine fleets and cut already low salmon prices in half for the 2002 season.

That was their deathblow for using any NMFS buyback plan. Under the Federal plan, a fishery reduction loan was limited to what could be paid back with an annual assessment of five percent annually for thirty years. When the processors dramatically cut the ex-vessel prices in 2002, they essentially cut off the seiners' ability to fund their own buyback, thereby forcing them to turn to lobbyists and Senator Ted Stevens for an earmark destined to the Southeast Revitalization Association (SRA). That is, the trap was set to get taxpayer funds specifically for their underhanded plan that included rewarding Stevens' own son with a lucrative lobbying and administrative take.

This is obviously what was behind Thorstenson and Zuanich's pitching the 2004 contract with Ben Stevens to the SEAS board. The intrigue surrounding Ben Stevens' absurdly expensive and unreported lobbying is just a more sophisticated continuation of the hasty former HB286 deal that the association leaders had made to keep fishermen under their (and the processors') thumbs.

Friends Fund Calhoun Street Operations:

When you take the broader view, the pattern of corruption is crystal clear. Zuanich and Thorstenson intentionally positioned themselves to benefit from anticipated insider deals and the dispersal of millions of dollars of public money. While setting up their force-out permit buyback, Thorstenson and Zuanich were simultaneously arranging a personal purchase of the Calhoun Street building (aka the Alaska Fishermen's Bldg.), opening it in September, 2003 just in time for their newly formed and soon to be enriched, rent-paying SRA to move in.

Before long, other operations like the Alaska Fisheries Marketing Board (AFMB)-and tens of millions of dollars of earmarked federal funds-would also move into the Calhoun Street building, fortuitously within direct sight of Ben Stevens' senate offices.

The AFMB-of which Thorstenson was a board member-was also created and funded by earmarks pushed through Congress by Ted Stevens. Without coincidence, the Marketing Board's funds also arrived just in time to start paying the Calhoun gang's rent.

In the October, 2003 SEAS' newsletter, Brailer Scoop, Thorstenson (who was also UFA's president) crowed that, "SEAS has been working with UFA to help procure funding for [the AFMB for] several years. It was and is one of the centerpieces of the UFA Marketing Plan."

The AFMB was the UFA's centerpiece just like the Calhoun Street Bldg was the choke point for Alaska fisheries control. And according to a government database, it was none other than "Mr. Trevor McCabe, dba Alaska Fisheries M", who received the initial $8 million that his former boss, Senator Ted Stevens appropriated for the AFMB in 2003. And at least $19 million more later on.

Yes, we are back to Trevor McCabe again, the former legislative aide, chief fisheries advisor and principal author of Ted Stevens' American Fisheries Act. (Read that as creation of exclusive processor pollock quota shares, the end of open markets, and deliberate industry consolidation of oligopsonistic 'market power' designed to foreclose independent businesses.)

Insert Taxpayer Funds & the Washing Cycle Begins:

You just couldn't make this sequence of events up: Advance North's McCabe and Ben Stevens who Zuanich and Thorstenson had contracted SEAS to, also became the vice chairman and chairman of the AFMB which was a tenant in Zuanich and Thorstenson's Calhoun St. building. Thorstenson and Zuanich had been instrumental in starting and funding the AFMB and Thorstenson became a board member.

And from there things move to the ongoing federal public integrity probe and FBI subpoenas. It is alleged that from the Calhoun Street Bldg. the closely-controlled AFMB then funneled millions of dollars-appropriated by Ted Stevens-to processors in what appears to be a thinly veiled scheme of kickbacks and bribes. It allegedly happened through salmon-based disbursements of grant awards, which immediately generated increased consulting income to Ted's son from a crab association who hired Ben to lobby on Crab Ratz, as well.

Although Thorstenson crows about how this infusion of millions of dollars has been so beneficial to the industry, it undoubtedly hasn't been of benefit to everyone. Quite the opposite for fishermen; because AFMB money has strengthened the monopolistic grip and political reach a few processors and politicians have on salmon and other fisheries.

2005 - SB113 Proposed for State Component:

When processors trying to extend their ratz-reach into Alaskan waters ran up against prohibitions in the Alaskan constitution against allocating 'common use' fisheries resources, state senate president Ben Stevens introduced Senate Bill 113. SB 113 would override the state constitution and coordinate state water fisheries with Senator Ted Stevens' federal plan to allow limited access systems or dedicated access privileges along with co-op linkages or whatever obfuscating terms are now in vogue for the act of forever allocating to processors the ownership of public resources.

SB 113 was reported to have been cooked up by the UFA executive board of which both Zuanich and Thorstenson are members. At PSVOA's annual meeting in 2005, I questioned Zuanich about why he hadn't been active in helping his membership develop a reasonable position opposing Ben Stevens' bill. Of course, he couldn't give a good answer.

Zuanich said "Ah, what can I say about SB 113, . who really understands it?" Then Tom Manos, one of the seven members of SEAS' SRA (its director was Zuanich) came forward to say that it wasn't Ben Stevens' bill, "Stevens had only sponsored it. Joe Childers wrote the bill." (In January 2007, Childers replaced Thorstenson as UFA's president; and he also wants a position on the NPFMC.) SRA member Manos insisted it was he who was pushing the bill for PSVOA, not Zuanich.

Everyone following SB 113 knew what it was about and it was a huge black eye for UFA when it failed to pass. Now members of the UFA Executive board, like Duncan Fields (also on AFMB's board, and recently replacing Stevens as its chair) are practicing all sorts of revisionist history by claiming they were against SB113 all along.

These second-tier UFA executive members, like Fields, Bruce Schactler (who Thorstenson said Ted Stevens approached to get the AMFB going), Childers, Al Burch and several others are stacked up like layers upon layer of a stinking onion, and ready to go.

Another Ted Stevens processor monopolization component was the Rockfish Demonstration (Pilot) Program inserted by rider into a federal 2004 Omnibus spending bill. The Rockfish Pilot Program extends the processors' iron grip into another fishery just like what happened when processor quotas arrived in crab. Only this time, the words simply change to read "cooperator quotas" while the fleets will once again become strongly linked to their processors. And once again the UFA has been doing nothing to help fishermen defend against this, in spite of their claimed opposition to processor control.

According to Thorstenson, "UFA has a policy of staying out of regional allocations; else there would be no UFA." That is a divide-and-conquer strategy; it's a death of a thousand cuts for the commercial fisherman. When you don't have an offense and your defense is bogus, you're not going to win: you're throwing the game. When UFA allows processors to monopolize fishery after fishery with exclusive rights and does not even demand they be disbarred from participation in open fisheries, something is wrong. It's ironic that throwing the game is only illegal in sports; when it comes to people's livelihoods it's called "just business as usual."

The recently passed Magnuson-Stevens Fisheries Act reauthorization included a three year extension, from 2 to 5 years, for the Rockfish Pilot Program - before it ever got underway. That disputes the idea that it is in any way a demonstration trial program, as the extension was asked for even after many opposing Alaskan fishermen had independently stood up and demanded the slow down of more rationalization.

If the associations had all the sway over the Murkowski administration that Thorstenson and Zuanich often claimed to have, why did fishermen wind up with so many economic scorchings? For instance, Zuanich was said to have been spending a lot of time in the Governor's office while the state was processing Global Seafoods' application. What was Zuanich doing there?

Zuanich Launched Seine Schemes in Puget Sound:

After a story about the FBI fisheries investigations linked my name with news Zuanich and Thorstenson had been subpoenaed for information pertaining to the lobbying contract with Ben Stevens, I received a packet of information about Zuanich's activities representing Washington fishermen in the 1990's. Included were some news articles, an affidavit and a brief explanation of what Zuanich did to incur fishermen's wrath during the campaign to defeat Initiative 640 in Washington state, that would have banned gillnet fishing on Puget Sound.

Also included was a page from The Stranger, a street publication in Seattle, on Zuanich's unsuccessful 1998 run for a seat in the Washington state legislature. This material provides a fascinating second opinion for those undecided about the integrity of Rob Zuanich.

Rating him as "nuts", The Stranger (Sept. 1998) said, "Zuanich teamed up with the hunting and fishing lobby and the aluminum industry to sell out the gillnetters during the Initiative 640 campaign. Basically, he scapegoated the little guy to save his own ass--a low blow done without the support of the fishermen he supposedly represents as head of the Purse Seine Vessel Owner's Association. The guy is a shithead."

The note with the packet explained that, "In late 1994, a coalition of fishing organizations had agreed that the fishing industry needed to become unified to oppose the impending net-ban initiative. The coalition decided that NO ONE should discuss the wording of the initiative to insure that when it was filed in January 1995 the initiative would be in the poorest written, easiest to defeat, form."

"Zuanich violated the trust of the entire Washington State fishing industry by sneaking behind their backs and going to the initiative's proponents, ON HIS OWN, to help them rewrite their anti-commercial fishing initiative... Because he helped with wording that targeted the small boat fleet but didn't entirely exempt the purse seiners, it cost the fishing industry nearly a million dollars in 1995 to defeat the initiative."

"Also, the lack of industry unity Zuanich revealed encouraged the initiative's supporters to file a second initiative in 1999 that was only defeated with another huge outpouring of cash from fishermen and support from alliances with environmental groups, State Democrats, League of Women Voters, churches, etc."

1995 Affidavit Removes Doubt, Shows Root of Conspiracy:

The affidavit, filed February 6, 1995 by Richard Smythe for Save Our Sealife (SOS), sponsors of I-640, both supports this version of events and provides more detail. Quoting from Smythe's affidavit:

"As a matter of courtesy, SOS informed commercial fishing interests of the initiative and invited their input. Mr. Zuanich, representing the Purse Seiners' Association [PSVOA], requested a copy of the draft initiative from me. A copy was also sent to Mr. Don Stuart, Executive director for Salmon for Washington.

"Subsequent to receiving the draft, Mr. Zuanich called me and asked for a private meeting with SOS leaders. He requested that only Mr. Frank Haw, myself, and one or two others who could keep his meeting confidential attend. A meeting was arranged for Mr. Zuanich on approximately November 23, 1994, at the Bristol Court conference room with Mr. Frank Haw, Mr. George Tellevik (SOS Co. Chairman), Mr. Bergman, and myself.

"Mr. Zuanich began the meeting by advising us that his primary purpose was to talk us out of going with the initiative. We responded that was not an issue for discussion because the decision was made to proceed with the initiative.

"Mr. Zuanich then stated that he understood from the language he reviewed, that our primary goals were to get the gill netters and trollers off the water and out of business. It appeared to him that his clients, the purse seiners, would survive under the language of the initiative. With that in mind, he recommended that we change the language to reflect those goals and to exclude purse seiners altogether and simply target the gill netters and trollers.

"Mr. Zuanich then told us about a vote by purse seiners and processors to spend as much as $250,000 to defeat the initiative. He stated that the gill netters and trollers were broke and could not come up with any money if the purse seiners were to withhold their dollars. He stated that Salmon for Washington, an umbrella association run by Don Stuart, was broke and already subsidized by the purse seiners at $1,000 per month. He stated that without the seiners and processors support, Salmon for Washington would be out of business.

"Mr. Zuanich talked about the wisdom of only targeting gill netters and trollers and excluding purse seiners. He made a commitment to withhold seiners' opposition dollars if we redrafted the initiative. We discussed his proposal and unanimously advised him that the initiative would definitely encompass all user groups including sportfishers. He obviously could not understand the genuine intent of the initiative "to rid state waters of wasteful fishing practices", rather than to simply "get rid of gill netters and trollers."

"Mr. Zuanich then changed his tactics and stated that he had several suggestions for changes in the language that would make him more comfortable regarding the purse seiners. He stated that the changes would make the initiative more acceptable and possibly unopposed by him in the end.

"Mr. Zuanich offered many changes that were discussed and several were accepted. There were several subsequent telephone conversations between Mr. Zuanich and members of our committee to discuss further suggestions, as well as another meeting at Bristol Court.

"Attached are true and correct copies of correspondence to and from Mr. Zuanich regarding his recommended changes.

Mr. Zuanich's handwriting is on the drafts."

Schemes then go 'North to SE Alaska':

It should come as no surprise that soon, up in Alaska, Zuanich's and Thorstenson's and their cronies' fingerprints would be found on everything else.

The first thing that struck me after reading the packet was that The Stranger's contention was the same one that I had independently leveled against Zuanich, Thorstenson, and Bedford, five years ago, when they filed HB 286. I said that they had acted "without the support of the fishermen they supposedly represented as head of their associations."

Whose support did Zuanich have? Was Zuanich working for fishermen when he was in the Governor's office, the UFA offices, and on all his trips back to Washington D.C.? If Zuanich's activities during the I-640 campaign are any indication, he was most likely selling fishermen out, just as it appears from the results. Certainly the carpet-bagging Zuanich seems a strange choice for Thorstenson to have teamed up with if Thorstenson was sincerely intent on uniting all sectors of the industry as he continually claims as his mission. But Zuanich was perfect for making the bum deals processors wanted for fishermen.

This activity couldn't be anything but a 'common law' (if not statutory) conspiracy and clear racketeer influencing, and participants like Thorstenson and Zuanich must be nervous about what the FBI investigators are looking into and might find. Simply looking at the answers given to APOC, the Martha Stewart mistake of lying to the feds may apply if these guys were to face a grand jury and conjure up stories incompatible with the various versions already woven in the web of deceit.

Wrap Up the Rotten Fish:

It has been an unforgivable assault on fishermen's First Amendment rights to have had their names, and hence their voices, stolen and used against them by the processor-heavy UFA.

All too often organizations in Alaska's fisheries policy-making arena do not actually represent the constituency an association's name suggests. This is one critical area where the new state administration should work to correct misrepresentations used to deliberately abscond with others rights, with UFA being a prime example. Neither does SEAS represent the entire body of the southeastern archipelago's salmon seine permit holders. Nor does it hold any public rights to administer a federally-funded buyback and violate the Civil Rights of non-members. (Don't forget that Governor Murkowski's administration simply aided and abetted it.)

In a recent private interview about the FBI investigations, Thorstenson Jr. himself expressed "concern that there may be something else out there." Unless that's a big white lie, Junior was concerned enough that he admits to having hired computer hackers to track the internet activity of both whistleblowers and federal investigators. That's hardly the act of someone who said he was feeling like his life has been made "a lot easier."

Regarding what if any testimony might have been given by whistleblowers, Thorstenson said none were "credible witness, or knowledgeable enough to know what's going on." I almost fell over when reading that line.

Well Junior-and Rob-how much more has been going on "out there" that we need to know about? Why are these two Judases (and their friends) still acting and speaking for the industry, and afforded association-legitimized access to the Legislature and other policy makers?

How much more do you have to know before saying enough is enough and ousting these guys forever?

By Victor Smith, Friday Harbor, WA

Part One - RICO Rendezvous at the Calhoun Street Depository