Intercepting Fraud Before It Hits the Shelves

Food standard authorities rely on food laboratories to use sophisticated instrumentation and techniques to identify components of foodstuffs.

The economic impact of counterfeiting products in the food and beverage industry amounts to millions in lost sales and profits to retailers, producers, and suppliers. Fake claims about the content of foods and beverages also pose an unsuspected risk to consumer health, as well as to people who base their food choices on their ethical and religious convictions.

Consequences

Consumers make their purchases in good faith, putting their confidence in the honesty and integrity of the supply chain. Counterfeiting is at odds with this reasonable assumption that a product is all that it claims to be on its labeling. Coinciding with the financial losses facing businesses on the production and supply side, the consequences to consumers can range from simply being deceived about the product’s content, or not benefitting from the anticipated efficacy of the product, to the more severe outcomes, including illness and death.

The world was made aware of this danger in 2008, when six babies died and 300,000 babies fell ill after drinking melamine-tainted milk products in China. Another major food scandal broke in Europe in 2013, when it was revealed that horse meat was being labeled as beef from cattle. Although horse meat is suitable for human consumption, the public health issue relates to the type of tests conducted to prove the suitability of the beef for human consumption. Since these tests differ from those applied to horse meat, applying the wrong tests to the sample could create an opportunity for hazardous substances, such as residual chemicals from veterinary medicines, to enter the food supply chain.

Food and beverage counterfeiting syndicates are motivated by greed and driven by the attraction of increased sales margins. Sometimes a reluctance to discard products that have passed their sell-by date leads to re-labeling and, in the case of exported products, there is an objective to bypass or reduce Customs and Excise duties on certain premium products.

Commonly Counterfeited Products

Despite the best efforts of national food safety authorities such as the U.S. FDA and the European Food Safety Authority, certain food and beverage product types continue to fall prey to counterfeiting. Notable examples include olive oil, goat’s milk, wines, basmati rice, honey, caviar, vanilla, and saffron.

Olive oil is product that is produced to different standards by varying methods of production, and its quality is also determined by the free acidity of the soil. The production and sell-by dates are also important because olive oil eventually oxidizes and becomes rancid. Since each of these factors determine the value of the end product, falsifying any of this information amounts to counterfeiting. In a similar vein, a variety of aromatic basmati rice types are sold at premium prices on the world market, and the increasing value consumers are placing on this product also makes it a prime target for counterfeiters who adulterate the product with the addition of cheaper types of long grain rice. The average consumer, recognizing the distinct aroma of the basmati rice, would probably not notice the presence of the other type of long grain rice.

Goat’s milk can be diluted with cow’s milk and the difference is very difficult to detect by taste alone. Honey can be counterfeited in various different ways. It can be adulterated with sugar, corn syrup, and other sweeteners, or the type of honey is misrepresented by a fake declaration of botanical or geographical origin to attract a higher price on the market. For example, Manuka honey is broadly hailed as a wonder product that demonstrates antiviral and antibacterial qualities. Not as sweet as normal honey, it is made by bees gathering nectar from the delicate flowers of the Manuka bush, native to New Zealand. When this rare and highly priced product is misrepresented, consumers are not only duped financially, but are also cheated of the health benefits associated with it. Caviar is another rare and expensive product that black market dealers substitute with the roe of other fish, passing it off as the roe of the sturgeon harvested only in the waters off Russia and Iran.