Former UGA prof indicted for alleged racketeering scheme involving proceeds from UGA-produced caviar
Updated: Mar 30, 2021
By Joe Johnson
A former University of Georgia professor has been indicted on charges of racketeering and theft by taking for diverting over $200,000 from a program the professor pioneered to harvest caviar from sturgeon that in an environmentally sustainable method, Georgia Attorney General Chris Carr announced on Monday.
Between March 12, 2012, and February 15, 2018, Douglas Peterson allegedly received 77 payments for alleged “consultation services” in connection with the sale of UGA caviar, totaling $208,229.00, according to Carr's announcement.
The story that Peterson was under investigation by the Georgia Bureau of Investigation was broke by this reporter in October 2018, when employed by the Athens Banner-Herald, in a story about Peterson retiring under a cloud of suspicion that he personally profited from the sale of caviar harvested from UGA-raised sturgeon.
UGA sells the caviar from Siberian sturgeon it raises at its 65-acre Cohutta Fisheries Center in northwest Georgia. Peterson, the professor in charge of the program, reportedly was profiting from the caviar sales by adding a “consulting fee” to each sale, according to the Georgia Bureau of Investigation.
As part of his research at UGA, the defendant pioneered an environmentally sustainable method for farming sturgeon.
In addition, the fisheries research professor and his wife, Joy, who also was a professor at UGA, allegedly used a UGA boat for their personal use at their Florida vacation home, according to the GBI.
In a statement at the time, Peterson denied any wrongdoing.
“This unfortunate situation arose from a misunderstanding,” he said. ”... I genuinely understood and believed for over seven years that what I did was acceptable and the university always received fair market value for its caviar.
″... I have already resolved the issue with the university in good faith, doing everything they’ve asked of me and I have always given 100 (percent) of my effort as a professor to the University. As for my wife, she had nothing to do with any of this and is totally innocent.”
According to a UGA spokesman, the 56-year-old former professor began working at UGA in 2001.
Caviar is one of the world’s most prized delicacies, but overfishing has pushed wild sturgeon to the brink of extinction, according to an article published by UGA Today in July 2007.
Peterson reportedly developed a “new, cost-effective and environmentally sustainable method for farming sturgeon with the potential of protecting wild sturgeon populations while creating a lucrative agricultural commodity,” according to the publication.
UGA began selling its caviar in 2009 in red tins that bore the Athletic Association’s UGA logo.
According to a sworn affidavit by GBI Special Agent Rebecca Herold, Peterson had proposed a roughly 50-50 profit-sharing arrangement with UGA for caviar sales to Michael Clutter, who at the time was Peterson’s boss at UGA’s Warnell School of Forestry and Natural Resources.
In an email dated July 28, 2010, Clutter explained to Peterson why such an arrangement would be unacceptable, according to the affidavit.
Among those reasons were “the fact that UGA provides the overhead costs to raise the sturgeon, the additional employees who work on the project and the fact that Doug Peterson has been a salaried UGA employee since the project’s inception,” the affidavit noted.
At some point following the email, Peterson “began billing ... consulting services as part of the sales price for the UGA caviar,” the affidavit noted.
The GBI began investigating after UGA’s internal division received a “hotline complaint” about Peterson’s alleged activities in May 2017, according to the agent’s affidavit.
A UGA audit provided the GBI with a sampling of invoices from 2013 to 2017 that indicated Peterson had billed UGA caviar customers.
The affidavit notes that the UGA caviar was being sold to a company in Texas for $35 an ounce, but $15 from each ounce sold was diverted to JDP Investments, a Florida incorporated business that listed Joy Peterson as an “authorized member” and identified her father as the company’s manager. The affidavit did not include information on how much in total JDP Investments allegedly profited from the caviar sales.
The affidavit notes that the mailing address for JDP Investment’s was the Petersons’ home in Georgia.
The Petersons had a vacation home in Port St. Joe, Florida, called “Blue Horizon” that was purchased in 2014 and owned by JDP Investments, according to the affidavit.
The GBI agent states in the affidavit that in April 2013 Peterson purchased a 2012 Sea Hunt 225 Triton center console boat and a boat trailer with money from the Warnell School’s general fund, the Cohutta sales and service account, another Warnell School account and funds from a South Carolina Department of Natural Resources grant.
Peterson, according to the affidavit, also used his UGA purchase card to pay storage fees for the boat in Florida and to buy fishing line.
The case was ultimately presented to a grand jury in Oconee County.
“We appreciate the Oconee County grand jury for their careful consideration of this case,” Carr said. “After it was communicated to him that the proceeds of the school’s program should go towards conservation and aquaculture research efforts, the defendant instead devised a scheme and diverted roughly half of the funds from the school’s program to his own personal accounts. We intend to hold him accountable for these alleged criminal acts.”
“Diverting proceeds meant to fund valuable research at UGA being used for personal gain is unacceptable,” said GBI Director Vic Reynolds. “The GBI is committed to investigating fraud and theft cases to bring them to a successful prosecution.”
If convicted for racketeering Peterson could be sentenced to five to 20 years in prison and fined up to three times the amount of his alleged ill-gotten gains, and a conviction on the theft charge carries a maximum penalty of five years in prison and a fine of up to $100,000.