US supplier fined for falsely claiming salmon was from Scotland By Douglas Fraser

Business/economy editor, Scotland Published duration 29 April 2016

image copyright St James Smokehouse

An American salmon supplier has been fined and given probation for falsely claiming its fish was from Scotland when it had been imported from Chile.

US prosecutors said it was sold under the award-winning St James Smokehouse brand, run from Annan in Dumfriesshire and Miami.

UpRiver Aquaculture, also known as MKG Provisions, pleaded guilty to violating a US law on false labelling of food.

It was fined £34,000, with three years of probation.

Court papers stated that it was supplying St James Smokehouse, though that client was not charged.

St James Smokehouse has won many awards for the quality of its products and for exporting, as well as a European grant for its Scottish processing plant.

Prosecutors did not publish evidence that the Smokehouse company knew that MKG had sourced its fish from Chile. However, it raises questions of whether it did enough to ensure the quality and legality of its branded products.

Salmon repackaged

The offence took place in December 2012, when MKG took delivery of 286 cases of Chilean farmed salmon.

The US Attorney for the Southern District of Florida issued a statement explaining: "MKG, acting through its employees and in connection with its business relationship with a client, St. James Smokehouse Inc, processed, smoked, and repackaged the salmon into bags provided to MKG by St James Smokehouse, which identified the salmon as a product of Scotland.

"The falsely labelled salmon was intended for wholesale distribution and sale by St James Smokehouse and was eventually sold to consumers through various retailers to which St James Smokehouse had sold the salmon."

The probation, which accompanies the $50,000 fine, is to "serve to provide oversight of the company's implementation of a government-required compliance plan to prevent a recurrence of the offence".

St James Smokehouse sells premium Scottish produce in Europe, the US and the Middle East. Its website emphasises the provenance of its salmon, and its many awards.

The packaging currently on sale in the US states: "This premium quality Scottish smoked salmon has been freshly crafted in Scotland, following a traditional family recipe".

'Massive opportunity'

Five months after the offence occurred in Florida, St James Smokehouse was successful in the Scottish Food and Drink Awards, its president picking up trophies as Scottish Food and Drink Entrepreneur, Business of the Year and Exporter of the Year at the awards in Edinburgh. In 2011, ahead of the offence, it had won best new retail product at the International Boston Seafood Show.

Brendan James Maher, who founded the firm in 2003, was quoted in Business Quarter magazine published six months before the offence involving Chilean fish, saying: "I saw a massive opportunity for us in North America quite early on.

"There's a huge demand for smoked salmon there, and a perception that anything 'Scottish' is superior, but what you had was US domestic smokers buying it in from Chile, smoking it and sticking it in a bag with a bit of tartan on it. The quality just wasn't there, so I decided to start knocking on doors."

He went on: "There was a gaping hole in the US market for a genuine Scottish product. We were confident we could fill that void.

"St James Smokehouse is now the most successful Scottish smoked salmon brand in the USA. It hasn't been easy, but we're now supplying the likes of Whole Foods Market, Mandarin Oriental hotel group and Kings".

Mr Maher set up his business in Annan, having moved north from Liverpool. He took over the Dumfriesshire plant which had previously been run by Pinneys of Scotland, part of Young's Seafood, and won a £210,000 grant from the European Fisheries Fund. He now lives in Miami.

Mr Maher told BBC Scotland: "We have worked entirely in accordance with the US Department of Justice (DOJ) in this matter and have provided all information requested.

"In early 2013, we made the decision to locate and purchase 2.5 acres of land in central Miami, Florida, investing $5.5m to construct our own smokehouse in the USA.

"After two years of construction, the smokehouse was completed at the end of 2015 and we now have the newest state of the art smoking facility in North America.

"St James Smokehouse now has approximately over 100 full time employees in the US and Scotland collectively.

"Our purchasing department has sole responsibility for the procurement of every single ingredient and component in production of all products.