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As per U.S. FDA experts, food fraud affects 1% of the global food industry at a cost of about $10-$15 billion a year, although some more recent expert estimates put the cost as high as $40 billion a year.
Economically Motivated Adulteration (EMA), primarily known as food fraud, happens when an individual deliberately excludes, removes, or replaces a crucial ingredient or component of a food item. It encompasses situations where an individual supplements a substance to a food product to enhance its appearance or perceived value. It extends beyond mere economic concerns. Depending on what substances are introduced, replaced, or omitted, food fraud can result in serious health ramifications, potentially leading to severe complications or even fatalities.
From adulteration and mislabeling to counterfeit products and substitution, food fraud can take many forms and affect a wide range of food products, undermining consumer trust, and compromising the integrity of the food supply chain. Having a thorough grasp of the potential occurrences of food fraud within any sector of the food industry, coupled with the implementation of suitable preventive measures, is imperative for any food enterprise to safeguard its interests and flourish in the contemporary market landscape.
What is Food Fraud?
Food fraud refers to the deliberate manipulation, mislabeling, substitution, or tampering with any food item within the entirety of the farm-to-fork chain, spanning from production to consumption. It involves deceitful actions like intentional substitution, dilution, or addition to food products or their components, as well as misrepresentation, all driven by motives of financial gain or causing harm. These actions aim to either enhance the perceived value of the product reduce production costs, or even inflict harm through malicious contamination.
Most Prevalent Types of Food Fraud
Given below are the most prominent categories of food fraud with respective examples of a food fraud incident.
1. Adulteration; the addition of unauthorized substances to food products to increase bulk, weight, or perceived quality. Adulterants may include cheaper or inferior ingredients, such as diluting olive oil with lower-grade oils or adding undeclared fillers to spices.
Example: In 2008, it was uncovered that melamine was being mixed into milk and baby formula in China to boost apparent protein levels after water dilution. Melamine, though, can lead to kidney failure and stones. This led to six infant deaths and about 300,000 illnesses. Melamine-tainted products were even found in confectionery sold in the UK during this scandal.
2. Mislabeling; intentionally misleading consumers by providing false or inaccurate information on food labels. This may involve misrepresenting the origin, quality, or composition of a product, such as labeling farmed fish as wild-caught or mislabeling conventional products as organic.
Example: In October 2013, the Hankyu Hanshin Hotel (HHH), renowned in Japan, launched an internal investigation prompted by reports of mislabeling elsewhere. They discovered 47 instances of mislabeling in HHH restaurant menus. Examples included processed meat injected with beef tallow being labeled as “beefsteak,” regular sparkling wine sold as “Champagne,” vegetables treated with pesticides labeled as “organic,” and store-bought chocolate marketed as “handmade.”
3. Counterfeiting; producing and selling counterfeit versions of popular or high-value food products. Counterfeit foods may be manufactured using inferior ingredients or substandard production methods, posing health risks to consumers.
Example: During Interpol’s Operation Opsen V in March 2016, the organization declared its biggest confiscation of counterfeit food and beverages to date. This haul encompassed 9 tonnes of counterfeit sugar and 85 tonnes of olives treated with copper sulfate solutions to improve their color.
4. Substitution; replacing one ingredient with another of lesser value or quality without disclosure. For example, substituting a cheaper species of fish for a more expensive variety or replacing premium coffee beans with lower-grade alternatives.
Example: In November 2018, a honey producer in Corsica faced charges concerning substitution. They combined 600 kilograms of imported honey with locally produced Corsican honey, which was then falsely advertised and sold as PDO (Protected Designation of Origin) honey, despite being a mixture.
Factors Leading to Food Fraudulent Practices
Factors contributing to food fraud include globalization, intricate supply chains, and escalating demands for specific foods. Globalization in the food industry facilitates fraudsters in sourcing ingredients and products globally, while convoluted supply chains pose challenges in tracing product origins and authenticity. Moreover, the heightened demand for certain foods, such as seafood and spices, provides avenues for fraudsters to exploit by profiting from counterfeit or mislabeled products. Various other factors also contribute to food fraud, with differences observed across countries, levels of development, and regulatory frameworks:
Opportunity
⇒ Technical aspects of products play a crucial role, including their physical state (e.g., liquid versus powder), degree of processing (e.g., whole herbs versus dried leaves), and complexity of composition (e.g., vanilla).
⇒ The availability of analytical testing methods and detection technologies also influences susceptibility to fraud.
⇒ Factors such as dilution of milk with water and substitution with melamine highlight knowledge-based opportunities for fraud.
⇒ Access to products along the supply chain, whether by authorized personnel, visitors, contractors, or unauthorized individuals, presents opportunities for tampering.
⇒ The number of times a product changes hands or the involvement of agents and brokers can further complicate traceability and oversight.
Economic Factors
⇒ Pressures to reduce prices, supply shortages due to political unrest, and fluctuations in demand contribute to economic motivations for food fraud.
⇒ Austerity measures impacting regulatory agencies and trade barriers also affect the economic landscape within which food fraud occurs.
Lack of Control Measures
⇒ Technical limitations such as the absence of specific testing methods for certain adulterants or ingredients contribute to vulnerabilities.
⇒ Managerial issues, including insufficient regulatory enforcement, societal attitudes towards fraud, and the absence of robust contractual frameworks, also play a role.
Complexity of Supply Chains
⇒ The length, transparency, and vertical integration of supply chains can impact the ease with which fraudulent activities can be carried out.
⇒ Reliance on single-source ingredients from approved suppliers versus sourcing from open markets can also affect vulnerability to fraud.
Insufficient Supplier Oversight
⇒ Inadequate supplier approval and performance programs, including the absence of comprehensive on-site audits with a focus on food fraud, contribute to vulnerabilities.
⇒ Analytical testing and tracking of results and complaints are essential components of effective oversight.
History of Food Fraud
⇒ Patterns of recurring fraud in specific products or regions, along with documented incidents, serve as indicators of heightened vulnerability to food fraud.
Detection and Prevention of Food Fraud
Addressing food fraud risks requires a concerted effort from all stakeholders involved in the food supply chain, including producers, manufacturers, distributors, retailers, regulators, and consumers. Here’s an overview of key measures for mitigating food fraud risks:
1. Supply Chain Monitoring
Companies should
1. Establish mechanisms for monitoring procedures and methods effectively.
2. Maintain detailed records of corrective actions to be taken if mitigation strategies fail or are not implemented correctly.
3. Verify the proper execution of monitoring activities and adherence to corrective measures.
2. Vulnerability Analysis
Conducting risk assessments and vulnerability analyses is pivotal for identifying potential vulnerabilities in the supply chain and prioritizing mitigation efforts. VACCP, or Vulnerability Assessment and Critical Control Points, not only targets food fraud but also expands its focus to include the systematic prevention of any possible food adulteration, whether deliberate or unintentional, by identifying vulnerable points within a supply chain.
Experts emphasize the importance of taking a proactive approach to risk assessment and regularly reassessing vulnerabilities in light of changing market conditions and emerging threats.
3. Training & Awareness
Establish food fraud awareness training across all organizational departments, including Procurement and Operations, to foster a deep understanding of key principles. These include sourcing from reputable, approved suppliers directly, rather than relying solely on brokers or agents, and ensuring stringent adherence to product specifications such as botanical species, varieties, and all ingredients, including critical attributes.
Set up clear procedures for handling non-compliant products and emphasize the importance of utilizing accredited testing laboratories and requesting Certificates of Analysis. Staff should also be educated on the impact of harvest cycles on product availability and quality to enhance overall vigilance and integrity in our supply chain management practices.
4. Supplier Qualification
Employing rigorous supplier verification programs and conducting regular audits of suppliers’ facilities are essential for ensuring the integrity and safety of the supply chain. Experts emphasize the importance of verifying the authenticity and quality of raw materials and ingredients and conducting thorough due diligence on suppliers’ practices and processes.
5. Ingredient Verification
Execute procedures to ensure the authenticity of ingredients, including rigorous verification processes by implementing testing programs specifically designed for highly vulnerable materials to maintain product integrity. Regularly conduct equipment maintenance and calibration to uphold operational efficiency and accuracy. Conduct cost-benefit analyses to evaluate the feasibility and efficacy of on-site audits for high-risk suppliers, ensuring risk management practices throughout the supply chain.
6. Traceability & Transparency
Set up traceability protocols, consisting of actions such as urging suppliers of sensitive products to undertake mass balance assessments, integrating suitable anti-counterfeit technologies, and verifying adherence to import regulations, Good Manufacturing Practices (GMP), and prevailing industry benchmarks. Instigating traceability systems and leveraging technology to enhance transparency are critical for tracing food products across the end-to-end supply chain and ensuring their authenticity.
7. Regulatory Oversight
Strengthening regulatory oversight and enforcement contributes to deterring food fraud and holding perpetrators accountable. It means to say that actively engaging with relevant authorities to report suspected cases of food crime, fosters a culture of responsibility. Experts advocate for stricter penalties and sanctions for individuals and companies found guilty of engaging in fraudulent activities, as well as increased collaboration between regulatory agencies, law enforcement, and industry stakeholders.
8. Consumer Education
Educating consumers about the risks of food fraud and empowering them to make informed purchasing decisions is essential for combating fraudsters’ deceptive practices. Experts recommend providing clear and accurate information on food labels, certification seals, and quality assurance programs to help consumers identify authentic and trustworthy products.
By adopting these proactive measures and developing a culture of vigilance, businesses can effectively detect and prevent food fraud, safeguarding both their consumers and their reputation in the marketplace. As food industry experts continue to innovate and forge new strategies for combating food fraud, they will remain principal to staying ahead of emerging threats and protecting consumers from harm.
Smart Food Safe Solutions as a Defense System Against Food Fraud
Smart Food Safe presents a consolidated array of digital modules, which can serve to curb instances of food fraud, supporting food businesses to maintain the highest levels of quality, food safety, and regulatory compliance.
Our platform furnishes powerful functionalities for managing supplier relationships, conducting risk assessments, and ensuring strict adherence to Hazard Analysis and Critical Control Points (HACCP) protocols. The integration of risk and vulnerability assessment within Smart Supplier enables the identification of potential points susceptible to food fraud in the incoming materials in a food industry. By designing product verification requirements in Smart Specification and confirming them in Smart Compliance, the system ensures rigorous testing and verification processes, thereby minimizing the risk of fraudulent materials entering the food production process. In instances where deviations occur, Smart CAPA can assist food companies in executing swift corrective and preventive actions, reinforcing overall fraud mitigation efforts.
Through the utilization of advanced features like automated document control, digitized records, and real-time analytics, Smart Food Safe facilitates control over potential fraudulent activities within the food enterprise. By enabling lot tracking and traceability, management of allergens and ingredients, and formulation of recipes, we ready businesses to guard their products against adulteration, mislabeling, counterfeiting, and substitution.
