Ellsworth man who caught $700,000 in elvers in 2012 convicted of tax evasion

Posted March 31, 2014, at 12:23 p.m.
Last modified March 31, 2014, at 4:29 p.m.

ELLSWORTH, Maine — A local man who caught more than $700,000 worth of elvers two years ago has pleaded no contest to tax evasion and theft.

Danny Deraps, 43, of Ellsworth will serve jail time, pay restitution and lose his elver harvesting license for the 2014 season, the state attorney general’s office indicated Monday in a prepared statement.

Deraps was found guilty on Friday of three counts of intentional income tax evasion stemming from false information he submitted to Maine Revenue Services on his 2010, 2011 and 2012 state tax returns, according to state officials and documents filed in the Ellsworth court clerk’s office. He also was found guilty of one count of theft by deception of funds from the Maine Tax and Rent Refund program.

Deraps admitted to intentionally underreporting his elver harvest for the 2012 season in violation of state fishing regulations, according to the statement.

In November 2011, the year before he caught and sold more than $700,000 worth of elvers, Deraps received a state tax and rent refund of $393.98, court documents indicate.

As a result of a plea agreement with prosecutors, Deraps is expected to be sentenced to 364 days in jail with all but 90 days suspended. He will have to serve two years of probation upon his release and is prohibited from fishing or assisting any licensed fisherman during the 2014 elver season, which is expected to begin Sunday, April 6.

Deraps is scheduled to be sentenced in June, according to court documents.

Deraps paid $25,338.51 toward his state income tax debt on Friday, according to the release. Before he begins serving his jail time, Deraps and state officials will finalize details of the remaining tax liability, which will be paid in full in the coming months.

The $25,3381.51 that Deraps has paid toward his income tax debt represents about two days of work for his 2012 elver haul. In 2012, before catch quotas were enacted, Maine’s elver season lasted a full 10 weeks. If he caught more than $700,000 worth of elvers during the 10-week season, that means he had an average weekly income of more than $70,000.

With fishing allowed only five days each week, Deraps would have had an average daily income of more than $14,000. His two-day average would have been more than $28,000, roughly $2,600 more than the delinquent taxes he paid on Friday.

Demand for the baby American eels, which are raised for the Asian seafood market, has soared since 2011, driving the price of elvers up to record highs.

In 2012, two years after they had averaged $185 per pound, elver fishermen in Maine earned an average price of $1,866 per pound, according to statistics compiled by Maine Department of Marine Resources. That year, the statewide haul of more than 20,000 pounds generated more than $38 million in gross revenue for Maine’s several hundred licensed elver fishermen.

After investigating Deraps’ 2012 elver harvest reports, state officials found that he earned more than $700,000 from elver fishing in 2012 and nearly $70,000 from lobster fishing the rest of the year, but he reported less than half of those earnings on his 2012 Maine income tax return.

Deraps also underreported his lobster fishing income for 2010 and 2011, state officials said. He is cooperating with Maine Revenue Services with respect to his 2013 income taxes, including his earnings from the 2013 elver fishing season.

“This case underscores the importance of harvester reports,” Patrick Keliher, commissioner of Maine Department of Marine Resources, said in the release. “Our ability to manage and sustain Maine’s marine resources relies heavily on accurate reporting of harvester landings data. We take this very seriously and will continue to be vigilant in our efforts to ensure compliance.”

Attorney General Janet Mills said in the release that her office will continue to pursue people who try to cheat the state out of public resources.

“In these difficult times, all Mainers must pay their fair share,” Mills said in the release.

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