Coral Reefs Are Being Decimated, All for a Few Gaudy Trinkets

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Kate Lunz didn't know what to expect as she piloted her white Florida Fish and Wildlife Conservation Commission truck to the Port of Tampa in July 2010. The day before, customs authorities had called the 32-year-old, PhD-toting marine biologist and asked her to inspect the contents of two 40-foot shipping containers that had been sent from the Solomon Islands and pulled for investigation.

This marked the first time Lunz had been summoned to the port to do her job. To look official, she wore her white FWC shirt, pulled back her short blond hair, and packed an employee badge, a professional accouterment she rarely used. A federal escort met Lunz at the port's entry and led her past rotund oil tanks and looming smokestacks toward a secure Customs and Border Protection warehouse the size of a football field. Lunz walked inside to find piles of what appeared to be white rubble wrapped in damp beer boxes and foreign newspapers. She snapped on a surgical mask to stave off the stench of mold and dust and began surveying the haul.

The sight devastated Lunz. The rubble was actually a giant batch of stony coral — an order scientifically known as Scleractinia — an exceptionally fragile animal that's vital to the health of the world's oceans. Thousands of pieces had been plundered from the South Pacific and shipped halfway around the world to be cleaned, turned into tourist trinkets, and sold down the coast of Florida at a staggering markup.


coral reefs

"Heartbreaking," Lunz says. "It made my stomach sink."

They were spectacular specimens; some looked like inverted jellyfish turned to stone; others were hardened, porous blobs of a deep-maroon hue. Lifeless starfish and expired crabs still dangled from the skeletons, aquatic detritus indicating the coral had been part of a thriving reef.

Curious warehouse workers paused as they strolled by and asked if this discovery was a bad thing. Yes, Lunz explained, it was a terrible thing.

Over the next three days, Lunz and a handful of colleagues sorted the coral piece by piece to ensure that the species listed on the boxes matched the species listed on the shipping documents. Only about half the shipment was labeled accurately. Agents seized the other, mislabeled half and estimated it to be worth upward of a million bucks. "The sheer magnitude of this shipment was just overwhelming," Lunz says. "This was a substantial part of a reef."

Over the next two years, four more suspicious shipments — of similar magnitude and similarly mislabeled — would arrive in U.S. ports, with the most recent having come to Tampa earlier this year. Lunz was called in to inspect each shipment, and each resulted in the seizure of misidentified coral.

The former reef material was bound for the curio trade, an off-the-radar market that spans from low-end, roadside shell shops to posh interior-design companies. The shipping containers and the repeated pattern of mislabeled coral are now at the center of a federal investigation being led by the U.S. Fish and Wildlife Service that could result in criminal charges and stiff financial penalties against the people who were importing it. Sources familiar with the ongoing investigation would not reveal the names of those involved but say the same Solomon Islands-based company exported all of the containers to several American importers.

"Every time I walk into that warehouse at the Port of Tampa, I'm flabbergasted by the size of the shipment," Lunz says. "I'm seeing shipments of coral in such large quantities that it's potentially devastating entire reefs."

Coral has a PR problem. It's not cute, so the public isn't fired up about saving it. Mounds of it piled in a warehouse don't stir the same visceral reaction as a dead rhino with its face gutted out for its horn or a bulldozer plowing through the Amazon. Most people don't even know coral is an animal. But corals hunt, eat, poop, and have sex. They even have huge orgies. For many species, once a year, shortly after sunset on the night of a full moon, masses of coral simultaneously release sacs of reproductive cells, turning the water into a cloudy primordial soup of sperm and eggs.

"Most people think of corals as rocks or some sort of plant life," says Andrew Baker, a University of Miami marine biologist with a British accent and supple black hair. "After all, they don't swim around like an animal should, they look like they're rooted to the bottom, and they grow like plants. But the cool thing about them is that they are... close relatives of anemones and jellyfish. Corals are covered in tiny stinging cells called nematocysts, which they use to help catch their prey. When a piece of potential food wafts by, corals use their tentacles to trap it; then they sting it to death and eat it. It's rather savage, actually."

Baker gets genuinely excited when explaining that many species maintain a delicate symbiotic relationship with algae called zooxanthellae that absorb sunlight, convert it to food, and help the coral produce its calcium carbonate skeleton. Coral by itself is white; it's the zooxanthellae living on its tissue that give coral the famous hues of bright pink, purple, and orange.

It's often said that reefs are the rain forests of the ocean — they cover less than one-tenth of 1 percent of the world's surface area, yet a quarter of all marine life exists in these ecosystems. But we're losing reefs four times faster than we're losing rain forests.

All the coral reefs in the world combined cover about 250,000 square kilometers — an area about the size of Michigan. But 75 percent of reefs are now threatened. There are the usual culprits — coastal development, climate change, diseases, and ocean acidification — and, in developing countries, additional destruction from fishermen who kill their catch by blasting the water with dynamite or cyanide. Reefs generate about $375 billion annually through tourism, fishing, and recreation. In South Florida alone, reefs are said to bring in more than $4 billion a year. They also provide natural protection against hurricanes, flooding, and tsunamis.

One need only stroll around South Florida to see how people undervalue coral by treating it as decoration. The lobby of the Ritz-Carlton in Manalapan is adorned with intricate, bright-white, branching colonies, including one piece that's a display stand for a pair of cheap pink flip-flops. A little farther north, at the Ralph Lauren boutique in West Palm Beach, a handful of pieces fills a decorative fireplace. In Dania Beach, dozens of coral skeletons line the windows of Alex's Gift Shop, a few with price tags tipping the $4,000 mark. Over in the display case are coral necklaces, earrings, and bracelets.

Baker points out an absurdity: There's no real connection between Florida waters and the coral for sale in stores.

"I can understand the appeal of curio and shell stores," he says. "People come down here and they want to take something away to remind them of their holidays. [But ] virtually everything for sale in those stores comes from Southeast Asia. They have absolutely nothing to do with Florida, the Florida Keys, or anything even remotely local. Ninety-nine percent of coral in the curio stores is from Southeast Asia. As a souvenir, it's illogical."

Why isn't Florida coral for sale? Because the species in our waters are protected, and two of the most important ones — staghorn coral and elkhorn coral — were placed on the Endangered Species List in 2006. They're now afforded the same amount of protection as an African elephant or a bald eagle. This designation, as well as the recent addition of more species as candidates for protection, was spurred by a more than 85 percent decline in coral cover on Florida's reefs since the '70s, mostly due to pollution and disease.

Bleaching is another problem. When water gets too warm, coral essentially vomits out the colorful zooxanthellae living in its tissue. The white skeleton becomes visible underneath. Sometimes reefs recover from bleaching; sometimes they don't. In 1997-98, a single bleaching event wiped out one-sixth of the world's shallow-water corals, mostly in the western Indian Ocean, Baker says.

An optimist might say there's an upside to coral's sad plight: It has spurred an entire body of research aimed at replenishing the reefs. Under the American Recovery and Reinvestment Act of 2009, $15 million was handed out to coral restoration projects, including one aimed at restoring "136 Olympic-size swimming pools" worth of coral in the Florida Keys and Virgin Islands.

One of the world's most impressive coral nurseries, situated about 30 minutes off the coast of Key Largo, is part of that project. Rows of seven-foot-tall PVC poles are secured to the ocean floor and submerged in about 30 feet of water. Each pole is equipped with several long fiberglass crossbars, and tied to each crossbar are slivers of coral that sway gently in the limpid sea. From a snorkeler's perspective, it looks like a vast underwater farm of hot dogs dangling from 1980s TV antennas.

The mastermind behind this underwater coral farm is Ken Nedimyer: part conservationist, part aquarist, part amateur scientist. He runs a small nonprofit organization called the Coral Restoration Foundation. Over the past ten years, he has developed arguably the most effective and simple method for growing reef-building coral: He ties a fragment to one of the crossbars and just lets it be. A specimen that starts out at three centimeters, or roughly the size of a pinkie finger, will grow into a healthy branching coral that measures 75 centimeters in a year. When large enough, these specimens are taken out of the nursery and transplanted onto select natural reefs.

Whereas many of his peers in the coral-research world come from academia, Nedimyer's business background sets him apart. Before he made a full-time gig out of growing coral to put back on reefs, he sold exotic fish and saltwater live rock for the aquarium trade.

"I was seeing reefs die for sure in the mid-'80s," he says. "By '98, they were just decimated." Now, he says, "I'm looking at how we can go full-on, 100 miles per hour forward, and industrialize this idea so it's massively successful. In the end, the scientists are going to have some really nice papers and interesting findings coming out. And I'm going to have put 100,000 corals back on the reef."

He's now busy transplanting 50,000 pieces of coral from his nursery to the Florida Reef Tract, the world's third-largest coral reef ecosystem, which spans from the Dry Tortugas to Martin County. He hopes his aquaculture approach and do-whatever-it-takes mentality can alleviate at least some of the damage, both here and abroad.

"One of our passions would be to go into Southeast Asia and work with some of these coral exporters [on a nonprofit basis]," he says. "There's no reason why all these people who are harvesting and exporting wild corals couldn't be growing them. The writing is on the wall. There's going to be more and more restrictions on the harvest and trade of wild corals and more controversy. If I was in the business, I would be very worried."

Lunz and the federal agents working on the case of the seized coral examined the documents that had arrived with the shipment. Paperwork indicated the coral had come from the Solomon Islands, an island nation in the South Pacific between Hawaii and Australia. There, the average person makes only $1,350 a year, and some local divers scrape together a living by pulling coral off nearby reefs.

Coral changes hands about five times between the ocean floor and a Florida tourist trap. Harvesters in the Pacific sell it to their local exporters, who pack up big shipments for sale to foreign markets. In the United States, there are a few scattered importers who buy these large shipments of coral skeletons. The importers in turn sell to wholesalers — again, there are just a few — who fashion coral into necklaces, lamps, and trinkets. From the wholesalers, coral makes its way to curio shops, jewelry stores, and design firms, where it is sold at retail prices.

Because coral is increasingly imperiled, the worldwide trade is supposed to be highly regulated. Shipments need to be properly marked and accompanied by permits as they move through ports around the world. The species that landed in front of Lunz were protected by the Convention on International Trade in Endangered Species of Wild Fauna and Flora, more commonly known as CITES. This agreement gives stony coral the same protected status as the great white shark and the Bornean peacock pheasant — not yet endangered but close.

In countries that permit the export of coral, such as the Solomon Islands, scientists are supposed to determine whether coral harvesting will damage the species or the environment. If the all-clear is given, countries can issue permits to exporters, who are supposed to include with each shipment a detailed list of which species are being sold so authorities can monitor the populations. When a container of coral gets to the United States, the regulatory burden shifts to customs and federal wildlife officials. They either trust the information on the permits or, when in doubt, call in experts such as Lunz.

When Lunz encountered that initial shipment in the summer of 2010, authorities weren't sure if it was just an accident that half the goods had been mislabeled or whether there was criminal intent. But then over two years, at least four more shipments containing misidentified coral arrived in the States — all from the same shipper — stoking suspicion and sparking the ongoing federal investigation.

This isn't the first time coral shipments have come under investigation. U.S. courts handed down their first felony conviction for illegal coral trafficking in 1999, to Petros Leventis, a Florida man who received 18 months in jail and two years' probation for importing coral from the Philippines, which had banned the sale of its coral decades ago. A U.S. law called the Lacey Act makes it illegal to handle wildlife collected in violation of other countries' laws.

In 2009, the U.S. Department of Justice prosecuted a German national for shipping 40 tons of coral from the Philippines to Portland, Oregon. In 2011, officials in Cebu, Philippines, confiscated 1.4 tons of poached coral bound for export. Weeks later, an additional 440 skeletons were seized in the same city.

One of the largest coral-smuggling cases is working its way through U.S. courts. In October 2011, a Virgin Islands-based company called GEM Manufacturing pleaded guilty to seven counts of smuggling black coral. GEM is the parent company of Bernard K. Passman, the world's premier supplier of black coral jewelry. Presidents and royal families have commissioned work from his company. He died several years ago, but his namesake company is still operating under GEM's umbrella, with boutiques in Las Vegas, Maui, and St. Thomas.

Investigators found that GEM ordered the slow-growing black coral from a Taiwanese couple. The orders were then forwarded to mainland China, where containers were packed, labeled as plasticware, and sent to St. Thomas, a U.S. territory. After being busted, GEM was ordered to hand over nearly 14,000 pounds of raw black coral — representing presumably millions of years of collective growth — and pay $4.5 million in fines.

Scientists such as Lunz are worried that the global demand for coral — legal and illegal — is hastening the death of reefs around the world. "There are so many forces acting against coral reefs right now," she says. "For us to still be harvesting coral for the sake of having it on a bookshelf is outrageous at this point. It's just sad."

George Melissas is the king of curio. He reigns over an empire built on coral colonies, scallop shells, alligator heads, and shark jaws. He's made a small fortune on starfish dyed blue, crabs mounted to coconuts, seashell wind chimes, and other nautical tidbits sold in bulk.

His home in the secluded, luxurious Gulf Coast town of Boca Grande — where there's a $5 toll to cross the one causeway in and out of town — is easy to recognize. Down the quiet, breezy side street a few hundred yards from the beach, it's the home with a long display of maroon coral, giant clams, assorted shells, and a well-placed vintage anchor. The electric gate featuring a Greek key pattern gives way to another, waist-high stack of coral, stone, and shells that surrounds a front-yard pool. At the bottom of the front porch, near the candy-apple-red Corvette, is an even larger display of coral and shells, a mermaid statue topping this one.

Melissas is the founder and CEO of Shell Horizons, a Clearwater-based company that claims on its website to be the "largest wholesaler of seashells and seashell products." The balding 57-year-old, who looks like a slightly taller, slightly slimmer Danny DeVito, with a thin gray mustache, says he's not sure if he's actually the largest wholesaler; it just sounds good.

A proclivity for profiting from the sea lingers in his genetic composition.

"My grandparents were in the sponge industry in Greece," he says, leaning over his kitchen counter. He's wearing striped shorts, a button-up tan shirt, and a slender black coral necklace with an expensive-looking sheen. "They came here from Greece [in the early 1900s], and they came here because there was a blight on sponges in the Mediterranean at the time. It was like a red tide."

Before the advent of cheap synthetic materials, people used natural sponges harvested from the sea, and sales of them were good. The Mediterranean blight was like a mini potato famine in the sense that it drove a tight-knit ethnic community to the shores of Florida's Gulf Coast to chase sponges. Scuba gear had yet to be invented; divers wore cumbersome lead boots and metal helmets. "Both my grandfathers had the bends and died of the bends," Melissas says. "They gave their life to the sea."

This risk-taking, moneymaking, fresh-off-the-boat subculture inspired Hollywood films such as 1953's Beneath the 12-Mile Reef, featuring Robert Wagner as "Mike Petrakis," the elder, sexier half of a Greek father-son sponge-diving team in Florida. An uncle of Melissas's starred in the film.

As a kid, Melissas worked in warehouses around Tarpon Springs, baling bundles of sponges and packing them in burlap bags to be shipped around the world. "Greeks work; they don't collect welfare," he barks. "It wasn't a fun job, but it was something that was family."

He discovered that the occasional oyster shell on the side of a sponge could be plucked, cleaned, and sold for a few cents to the tourists who frequented restaurants owned by his family. By the time he was a teenager, Melissas was buying crates of curios at wholesale prices from a shop in Fort Myers. He fashioned the shells into trinkets and centerpieces to sell at a restaurant where he waited tables.

Tired of dealing with a middleman, Melissas decided at age 17 to go directly to the source. It was a risky move. He blew his life savings on a plane ticket to the Philippines, much to his father's dismay. "We're trying to get away from what your grandfathers did and the stinking packaging houses. Who's gonna buy shells?" he recalls his dad lamenting.

The wholesaler in the Philippines expected to meet a 50-year-old businessman, not a brash teenager running a shop in his parents' back yard with barely enough money to make it back to the States. This young-and-dumb approach struck a chord of sympathy, compelling the wholesaler to give Melissas a batch of Pacific shells and 90 days to sell what he could.

Dead sea life has treated Melissas well in the four decades since that inaugural trip. He's well-off and well-traveled and says he owns a bone-fishing club in the Bahamas and has a partnership with a factory in the Philippines.

Melissas doesn't conceal his disdain for his critics. He launches into tirades against Tony Cruz, a Filipino news correspondent who has accused Melissas of smuggling coral from the Philippines; and Anna Oposa, a Filipina activist who went before the Philippines Senate in 2011 to levy allegations that Shell Horizons had poached protected coral from the country's waters. Melissas says they are "totally false" allegations based on outdated, 1970s pictures of free divers dismantling a reef that were once posted on his website. He stresses that he has never been arrested for smuggling or any illegal activity in the Philippines.

"For environmentalists, it's broccoli or nothing," he says. "The environmentalists are concerned about everything. They're weirder than Michael Jackson."

Melissas insists there's plenty of coral left in the sea and that scientists are exaggerating news of reef decline to secure funding. "Take the square footage of all the coral in the world and it's three times the size of the United States," he says. (The World Resource Institute, meanwhile, estimates the total area covered by coral reefs is "roughly equivalent to the size of the United Kingdom.") If coral is so rare, Melissas asks, why is he paying the same price for it that he was paying in the 1980s?

While there's enough coral in the ocean for Melissas, he says other people shouldn't import or export it because "it's a fragile ecosystem that needs to not be messed with." Although his website sells lamps made from coral for $375 each and eight-piece assorted coral collections for $368, he points the finger at a curio wholesaler in Texas that he says supplies to Walmart and Michaels, the retail craft chain. They're doing the real damage, he implies, going on to state there "must be some ethical limits to the dollar bill."

Asked about the seized coral from the Solomon Islands, Melissas looks uneasy at first. His wife wanders into the kitchen and, seemingly sensing the subject has been broached, comments it's good that New Times is recording the interview. Melissas says he never imports coral directly but admits he buys "from people who import from there," though he won't identify those people. "If the price was right, I bought it. I wasn't the only one buying it."

Melissas spews disgust for Fish and Wildlife's investigation. It took about eight people to pull that batch of coral from the water, he says, and it was perfectly fine because shipping channels were being cut through the area and the coral was being reseeded (sources familiar with the investigation say that is doubtful given the volume of coral and species targeted for collection).

Most important, he says, there was no intentional mislabeling of the coral. Rather, overzealous inspectors "hyped it to the max" to appear as though they had made a big bust.

"A piece of lace coral looks a little bit like a piece of bird's-nest coral," he says. "And these are uneducated island people, almost Aborigines, packaging it up. And you're expecting them to know [how to label it?]"

Melissas claims that other containers, packed with the same species and labeled the same exact way as the July 2010 shipment, have passed through different ports without any hindrance.

His face contorts into an exaggerated expression of alarm when he's told that the coral seized in July 2010 at the Port of Tampa has an estimated worth of $500,000 to $1 million. Lowering his head so that his mouth is positioned an inch from a tape recorder, he booms, "They lied. They lied!" His voice blasts through the kitchen. "Fish and Wildlife definitely threw up on the American public when they said it was worth that much... A 40-foot semi, completely full, average price is 18 grand. My Greek cross to God."

Melissas raises his caterpillar eyebrows, pats his back pocket, and likens the $1 million appraisal to cops who exaggerate a weed bust by appraising it at street value, not its wholesale price. (Sources familiar with the ongoing investigation readily admit that some of the shipments were accompanied by invoices that were about $30,000 for a full container; the $500,000 to $1 million estimate is the retail value, they say.)

"Coral is not expensive, because it is plentiful — especially corals that are dying to begin with," he says. "There's a company in California that doesn't lose one piece of coral, and they bring in a 40-footer every 30 days... I could never buy all the coral offered to me."

Whether a container of coral is worth $18,000 or $1 million seems like petty quibbling when one considers it could soon be extinct. Although Melissas may be accustomed to bulk purchases of coral, scientists are not, and most are dismayed when told about the shipments in Tampa.

Lunz is still heartbroken about the quantity of coral she has inspected over the past two years. After the federal investigation wraps up, she intends to publish a scientific paper detailing the extent of ecological destruction represented by these shipments.

"The curio trade is alive and well, and I don't think people, scientists included, realize the magnitude of it," Lunz says. "From my scientific, expert opinion, I'm seeing a trade... that may no longer be sustainable."

As for that first giant batch of coral she inspected, it took two tractor-trailers to move the seized portion to Nova Southeastern University's Oceanographic Center in Dania Beach, where it remains today. There are still moldy boxes bearing the logo of SolBrew, a lager from the Solomon Islands, wrapped around a few of the skeletons. A dead lizard and dust have replaced the dead starfish and crabs. Some of the colonies are neatly packaged in large Tupperware-like bins, some are strewn across a table, and a few are being cleaned so they can be used for coral-education efforts. So much coral was sent to the university that a small team of graduate students had to be assembled to sort through and organize it.

And still, that's only one-half of one shipment to one port.

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