Food Business News - February 14, 2012 - 20

Deﬁning the scope of food fraud

Food safety, food defense issues not the only causes of concern for food processors
Mr. Spink said. “It does include misbranding, stolen goods, diversion, dilution, country-oforigin labeling, tax avoidance, smuggling — all of these other types of risks.” He said some of the biggest food-fraud incidents are in commodity products such as milk, olive oil, juices and seafood. With seafood, he said perpetrators often swap species or subspecies. “All types of fraud are very difﬁcult to quantify because the fraudsters … are trying to evade and avoid detection, they are trying not to get caught,” Mr. Spink said. “They work very hard to circumvent our testing systems or trick consumers into believing they are consuming a genuine product. It is really near impossible to quantify how much fraud there is.” Overall, he said the best way to prevent fraud is to increase the risk of getting caught and reduce the potential proﬁtability. He said rather than looking at speciﬁc incidents, it’s better to look at the big picture, such as why putting melamine in products was perceived as a good fraud opportunity. Fraud is based on how much money someone may make per unit, per sale and over time in addition to how easy the product is to copy and go unnoticed. He said it has been eye opening for companies to go through the process of understanding the supply chain and market economics as well as the capabilities and capacity of potential criminals to identify fraud opportunities. “Based on the way we the experts have deﬁned food fraud, the risks and countermeasures, I think the agencies, F.D.A. included, and companies have been doing a ﬁne job of combating it,” Mr. Spink said. “The key is we as the experts have to further deﬁne the risks and then identify more of the basics like the type of fraud and fraudsters and then we the experts also have to help with how to deﬁne risk assessment.” He said the goal is to prevent adulteration of products before it happens. The overall magnitude of public health threats comes ﬁrst from food safety issues and then food defense vulnerabilities with food fraud coming in third, according to Mr. Spink. He said food fraud needs to be calibrated inside risk assessment for a company. Yet that is not to downplay the potential risks of food fraud. “It does appear that risk of food fraud will continue to become more intense and more catastrophic for companies and for consumers as well,” he said. FBN — Allison Gibeson agibeson@sosland.com

hen melamine was identiﬁed in infant formula and pet food, it didn’t ﬁt the traditional deﬁnitions of a food safety or food defense incident. The products weren’t adulterated due to the way they were grown, processed, packaged or handled, and the perpetrators goal wasn’t to sicken individuals. The goal was for the producer to make more money by using a cheap “replacement” ingredient. Such instances led researchers at Michigan State University to realize there wasn’t a clear deﬁnition for the risks that lurk when someone deliberately substitutes, adds, tampers or misrepresents food, food ingredients or food packaging for economic gain. So the researchers, including John Spink, assistant professor and associate director of the Anti-Counterfeiting and Product Protection Program at Michigan State University, have sought to deﬁne the category of food fraud and have published their ﬁndings in the Journal of Food Science, a journal of the Institute of Food Technologists. “Food-related fraud has been going on since the ﬁrst time anyone exchanged

commerce … The thing that has led it to come forefront now is the volume of production that any one company has and the global distribution,” Mr. Spink said. Mr. Spink said the global scope of many food and beverage companies’ supply chains make them a target. In the past, he said production was limited by geography and volume, and the removal of the barriers has combined to make the potential risk of food fraud much greater. “There are a near inﬁnite number of fraudsters and there are a near inﬁnite number of types of fraud,” Mr. Spink said. “That is real key because the bad guys will evolve, and they are usually self-funding, resilient, creative and intelligent and they will continue to seek opportunities to commit fraud.” While Mr. Spink said it is generally thought that 5% to 10% of world trade is fraudulent in some way, he also clariﬁed that not all food fraud cases represent a potential danger to consumers. In some cases it may mean the country-of-origin labeling is wrong, a product’s weight is misrepresented or there is too much added water. “Fraud is much broader than adulteration,”

Extra virgin olive oil
A study conducted by the University of California at Davis and published in April 2011 found that the quality level of the largest imported extra virgin olive oil brand names sold in California was inconsistent at best, and that most of the top-selling olive oil brands regularly failed to meet international standards for extra virgin olive oil.

Seafood
A 2009 report issued by the U.S. Government Accountability Ofﬁce outlined the challenges federal agencies face in attempting to detect seafood fraud, which involves the labeling and selling of lesser value species as higher value species. The Food and Drug Administration examines only 2% of imported seafood annually, and its primary seafood inspection program does not address economic fraud.

Melamine
In 2008, milk contaminated with melamine, which was used to boost the protein content, was used to process a variety of food and beverage products, ranging from infant formula, cereals, crackers and pet food, and shipped around the world. FBN

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February 14, 2012

Food Business News - February 14, 2012

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