GloucesterTimes.com, Gloucester, MA

September 19, 2012

Ex-AG asked to probe fishing permit bank

By Richard Gaines
Staff Writer

---- — Former state Attorney General Scott Harshbarger is under contract and has begun an assessment of the “governance, policies and operations” of the Gloucester Fishing Community Preservation Fund, the permit bank has announced..

The fund, which is organized as a 501(c)3 non-profit, operates as a permit bank under the presidency of Vito Giacalone, and was capitalized with $12 million in a 2007 mitigation grant from the state for sacrificing Grade A fishing and lobstering grounds to a liquefied natural gas terminal just offshore.

The impetus for the decision of the fund to employ Harshbarger was an undercurrent of allegations and questions about the propriety of decisions made by the fund, which has a small board — four members including Giacalone — with interlocking tied to the Gloucester-based Northeast Seafood Coalition and numerous nonprofit fishing cooperatives organized under the Northeast Sector Service Network.

In addition to his role as president of the preservation fund, policy director of the coalition, the region’s largest commercial groundfish industry organization, Giacalone is also an active groundfisherman, and acommercial real estate developer who has redeveloped Fishermen’s Wharf at Harbor Cove. Giacalone’s three sons operate an arm of BASE, the region’s largest auction from Fishermen’s Wharf.

A press release by the preservation fund Tuesday did not address the reason for acting to resolve the rumors and insinuations of insider trading now — more than seven months after state Sen. Bruce Tarr and Rep. Ann Margaret Ferrante, the Gloucester legislative delegation, wrote to Giacalone as president of the fund, and former Mayor John Bell, as chairman of the board of the seafood coalition, urging the two interlocked organizations to “seek legal counsel concerning their respective organizations.”

The existence of the letter was first reported in the Times last July. Tarr and Ferrante wrote to Giacalone and Bell following a meeting they initiated to informally share their receipt of “phone calls from some in the industry complaining that there were conflicts of interests and unfair business advantages as a result of some, most notably Vito Giacalone, wearing too many hats.”

The announcement by the preservation fund quoted Harshbarger as being determined to “get to the bottom of these vague but serious allegations made by some in the community about the governance of the fund and the perceptions they have created.”

The fund also reported that Harshbarger, who was attorney general for two terms, 1991-1999, “has already begun analyzing internal operations of the fund and interviewing board members. The review will also include interviews with community leaders and others in the fishing community,” the preservation fund’s statement announced.

The announcement of the decision to retain Harshbarger, now a senior partner with the international law firm Proskauer which is rooted in New York City, came just days after the National Oceanic and Atmospheric Administration declared the groundfishery centered in Gloucester and New Bedford to have declined into an economic disaster.

That declaration opens the political door to an effort led by Sen. John Kerry to obtain $100 million in disaster assistance for the region’s ports, fishermen and communities.

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Richard Gaines can be reached at 978-283-7000, x3464, or at rgaines@gloucestertimes.com.