Mayor Takes on N.Y.C.'s Fishy Business

CLAD in orange and red moon suits, the new workers unload boxes of salmon and scrod in the inky black of a New York night.

Nearby, men who just a few days ago had been working the docks, in some cases for decades, taunt the new crews from behind a police barricade.

"These guys aren't up to code," yells one of the out-of-work protesters. "Why aren't all these cops giving them tickets?"

It is all part of the latest reel in one of New York's longest-running pieces of theater: City Hall versus the mob.

In this installment, Mayor Rudolph Giuliani (R), in an effort to eliminate alleged Mafia influence, replaced the six companies that unload seafood at the Fulton Fish Market, the world's largest, on a site along the East River. The mayor's actions prompted a wildcat strike by other workers that left the herring high and dry for a night.

At this point, the swordfish and ginger-crusted salmon are still showing up on peoples' plates at New York restaurants. But the issue of control of the market is far from resolved.

Mr. Giuliani, one of the most persistent Mafia-busters since Thomas Dewey, is using a new weapon in his latest battle: regulatory reform. Instead of criminal prosecution, city leaders are using licensing laws to try to break what they allege is organized crime's hold on the lucrative business.

Giuliani began requiring the licensing of workers and the companies doing business at the market. The six companies, which controlled unloading, were denied licenses. A Long Island company was given a license to move the fish - thus the nightly protests, punctuated by fist-shaking and bottle-throwing.

The strike was not a surprise, say some city officials. "Given the extent of the organized crime hold on the market and the radical nature of the changes proposed, it is not surprising that there were some disruptions," says Kenneth Fisher, a City Council member from Brooklyn.

According to public documents, organized crime has exerted its influence in two ways: coordinating the unloading crews to control the entry of fish in the market and setting up phantom fish wholesalers, who have contracted for millions of dollars of fish without paying for them.

The licensing scheme may cut down on the sale of fish to phantom companies. In the past, investigators have found that 10 to 12 percent of the firms doing business at the fish market did not show up on city tax rolls or anywhere else. They found that one company operated under five different names.

Mr. Fisher, an attorney, found out about this before he was elected to the council. "A small Danish fish company got stiffed by a phantom company in the market, and when we sued them, they went bankrupt and were in business the next day under a new name," recalls Fisher.

The licensing is a significant step, says Brian Carroll, the former court-appointed deputy administrator, now working for Coopers & Lybrand, the accounting firm.

"This is one of the first times they have tried to break organized crime's hold with regulatory reform instead of criminal prosecution," says Mr. Carroll.

Despite the disruptions this week, the city expects the price of fish to come down and the quality to go up. The new unloading firm, for example, is charging 20 percent less to move the fish.

"The real savings will come when the suppliers gain confidence that they can get their fish unloaded without hassle and the buyers have confidence they can get their fish loaded without the danger of getting beat up," says Fisher.

Prosecutors, including former Governor Dewey, have focused on the fish market in the past. In the 1920s, the government charged Joseph "Socks" Lanza with racketeering. He went to jail.

Then, in 1982, the Feds prosecuted Carmine Romano for racketeering in the markets. He went to prison but his brother Vincent and son Peter continued to operate at the market. "They were all members of the Genovese organized-crime family," says Carroll.

In 1987, with organized crime still entrenched in the market, then-federal prosecutor Giuliani brought a civil suit under the Racketeer Influenced and Corrupt Organization Act (RICO). Frank Wohl and Carroll were appointed as administrators.

With only a small staff, the government found it difficult to control the chaotic fish market. "What we did was enforce a judgment and see that there was no egregious theft and violation of the antitrust laws," says Carroll. The administrators also formulated a plan to regulate the market.

The plan, however, was not implemented until Giuliani took office. In March, after the council approved the changes, a suspicious fire gutted part of the market. If the new plan does not work, or the fishmongers refuse to abide by the law, Giuliani has threatened to shut down the whole market.

"It would be better for the city, actually, not to have the Fulton Fish Market if it's going to be operated the way it's been," says Giuliani. But Fisher doubts this will happen.

"There are legitimate businesses who, given the choice of caving in or getting hurt, will choose to cave in," says Fisher.

*Monitor freelancer Eric Moskowitz contributed to this story.