Food Fraud in the Spotlight

Food fraud is rising. Global events like the pandemic, Brexit, high food prices and the war in Ukraine, have further impacted food supply chains, as producers struggle to meet demand. This has increased the risk of food fraud as criminals exploit the volatility in the market.

Operation OPSON, a joint Europol-Interpol operation, removes counterfeit and substandard food and drink. Through December 2021 to May 2022, they seized 27,000 tonnes of fake food, and opened over 175 criminal cases involving eight criminal networks.¹

In this blog we will look at the current food fraud landscape, the likely impact of a food fraud scandal on consumer behaviour within that and share our view on what best practice for food fraud management looks like.

Impact of a food fraud scandal on consumer trust

The 2013 horsemeat scandal was a watershed moment, with the integrity and assurance of food supply networks being reviewed in the 2014 Elliott report.² Professor Elliott, who led the report, recently said, “We’ve lost a lot of control over the food we consume, particularly food produced outside the UK. There’s now no sharing of intelligence on fraud that is happening or suspected to be happening on mainland Europe.”³

Today consumers have a “field-to-fork” approach⁴ expecting sustainability and transparency. Recent Deloitte research found that 88% of customers will rebuy from a brand they trust and showed that trustworthy companies outperform peers by up to four times in market value. It also showed how customer perceptions sour when companies fail to build trust. This could lead to:

• Loss of product trust: Many consumers may choose to shop/buy food elsewhere; and
• Reputational loss: High-profile news reports can cause negative publicity, resulting in loss of customers and business value, or potentially close brands/shops.

What does good food fraud risk management look like?

In order to support food manufacturers, producers and sellers in tackling the rising risk of food fraud, Deloitte and McCormick⁵ have identified six key areas that are fundamental to sound food fraud risk management:

1. Governance, leadership and “tone from the top:” Management should ensure that they are appropriately considering food fraud and take steps to mitigate the company’s risk and ensure correct messages are delivered to employees.

2. Policies and procedures: Organisations should ensure internal and external policies and procedures are interconnected, and that they are being implemented and followed.

3. Training and communication: Training and communication is vital to ensure that companies are raising internal awareness of food crime and food fraud, so employees can detect potential incidences of food fraud and know what they need to do.

4. Vulnerability assessment and supply chain illumination: Businesses should evaluate their risk of food fraud through performing vulnerability assessments, utilising supply chain illumination to comprehensively map their supply chains.

5. Monitoring and horizon scanning with risk sensing and Dupe Killer: Organisations can collate various data points, including subscription feeds and AI technology like Dupe Killer, to identify risk and drive actionable outcomes.

6. Food testing, supplier inspections and deeper dives: Companies should implement appropriate testing/reviews to detect and prevent food fraud. These include detailed inventory reviews to annual fraud surveys, supply audits, and reviewing electronic material and accounting records.

Given the increase in food fraud cases, it’s never been more important to assess all parts of the supply chain. Organisations need full visibility so they can implement appropriate measures to tackle areas of concern. If you would like to discuss how this applies to your organisation, please get in touch.

This blog is part of a series of articles and regular events on the topic of food fraud.

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Reference

¹Food fraud: about 27 000 tonnes off the shelves | Europol (europa.eu) and Food crime operations (interpol.int)

²Elliott review into the integrity and assurance of food supply networks: final report - GOV.UK (www.gov.uk)

³‘We have lost a lot of control’: UK at risk of food fraud, safety expert warns | Food safety | The Guardian

⁴Some relevant articles for reference: Field to Fork - The Power of Provenance - Agency UK

⁵McCormick & Company, Foods, Ingredients and Flavors (mccormickcorporation.com)