When consumers go to a store and make a deliberate decision to buy organic food, they have a right to know where the food has come from, what it’s made of, and if they can trust the “Organic” label. In at least two recent cases – involving a major retailer and an agribusiness – the “Organic” label has proved to be at least a mislabeling if not outright fraud. With the meteoric rise and profit potential of the organic foods industry, this hardly comes as a surprise.
Targeting Target
According to statement from Cornucopia – a public interest group that focuses on food and agriculture – it has filed formal complaints with the USDA’s (US Department of Agriculture) organic program and Wisconsin and Minnesota officials, alleging that Target Corporation has misled consumers into thinking that some conventional food items it sells are organic.
For example, Silk soymilk’s manufacturer, Dean Foods, had shifted their products away from organics and into conventional soybeans – without notifying retailers or changing the UPC codes. And the Wisconsin-based Cornucopia had discovered that Target still advertised its Silk soymilk with the term “Organic” on the carton’s label.
The crux of the matter is that there is confusion in the marketplace about the difference between “natural” and “organic” – a fact borne out by recent surveys. Consumers think that ”natural” is government-regulated and “organic” is not – when it is just the opposite. In fact, “natural” is more often than not just marketing hype, while “organic” means adhering to strict government-regulated farm and food handling standards. And many feel that some companies are taking advantage of this confusion.
Earlier, Target and Cornucopia had also tangled over the retailer’s continued association with its organic milk supplier – Aurora Dairy – which was found by USDA investigators to have violated 14 federal organic regulations. But Target is just one of a number of retailers who have been caught misrepresenting conventional food as organic with the use of improper signage. One of them is Wal-Mart which has already “cleaned up its act.” Industry watchdogs such as Cornucopia – as well as organic food consumers – fully expect Target to do the same and to stop taking advantage of organic foods’ market cachet while refusing to do the grunt work required to earn a genuine “Organic” seal.
Organic Scam Stopped
The Northamptonshire County Council Trading Standards in the United Kingdom – with the support of the UK’s Food Standards Agency – has done brand protection a great service with its successful prosecution of One Foods Limited (OFL) – the company behind an organic food scam worth more than half a million pounds. The home delivery and wholesale business had engaged in a five-year fraud in which it supplied a range of products falsely described as organic to consumers and businesses across the UK.
Ironically, the name of the company - ONE – stood for organic, natural and ethical; yet their products and business practices were anything but. Their modus operandi involved:
- Regularly using non-organic ingredients.
- Using synthetic astaxanthin in “organic” salmon - an additive that is used in feed for farmed salmon to achieve a pink flesh color and which should not be found in true organic salmon.
- Asking employees to remove non-organic ingredients, including Atora suet, from their original packaging and re-bag it in clear bags for use in products being made by OFL – in order to prevent the original non-organic packaging from being seen if an organic certification body or trading standards visited.
- Logging non-organic chicken against a code which would be recognized by OFL’s computer system as game. (Since game is never categorized as organic, it would be highly unlikely that any ingredient classified as such would be closely scrutinized by organic assessors.)
- Classifying up to 50% of supplies as non-stock items so they could bypass the computer system without any record of the stock being moved in or out, thus eliminating the paper trail in case of any inspection.
- Creating 28 fictitious invoices to show a far higher amount of organic chicken being purchased than was actually the case.
Over the relevant period, approximately 28% of the ingredients purchased by the business were not organic. This means the business sold over £500,000 of product mis-labeled as organic, when the average profit margin is added.
One Food Limited Director Neil Stansfield has received a 27 month prison sentence, while Company Secretary Kate Stansfield and Operations Manager Russell Hudson, both received suspended sentences and 150 hours of community work. All three pleaded guilty to selling conventionally grown food as organic.
About the FSA
The Food Standards Agency has a range of resources available to help local authorities that suspect, or uncover, food fraud. These include the National Food Fraud Database and the Food Fraud Advisory Unit, which employs local enforcement officers with specific experience in tackling food fraud. One of Northamptonshire County Council’s Trading Standards Officers involved in this investigation is a member of the Food Fraud Advisory Unit. The Agency also has a ‘fighting fund’ that can be used, as in this investigation, to provide financial support to local authorities.