Counterfeit Foods: Are You Eating the Real Thing?

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Counterfeit Food
Think counterfeiting only extends to that knock-off name-brand purse or those slightly irregular DVDs you bought on the street? Think again. Everything is fair game to counterfeiters these days, from music to computer equipment to car parts.

But perhaps most frightening: The food you eat and the beverages you drink might not be the real thing.

While all counterfeiting is problematic, counterfeit food and beverages are especially tricky. The inherent health and safety risks are higher than those associated with, say, a knockoff pair of sunglasses, and they're also harder to detect once they've made their way onto store shelves. And unlike a fake purse whose handle falls off after you buy it, fake foods can hurt more than your wallet.

A Fish by Any Other Name

Charges of mislabeling items to increase the sales prices aren't new. Only last year, large retailers were targeted in a lawsuit that claimed the products they were selling as organic weren't. Tamara Ward of the Food and Drug Administration says that counterfeit food cases can occur when consumers can't easily tell one item from another (as is often the case with certain varieties of fish), or are unable to distinguish by taste the differences among types of certain foods (such as extra virgin olive oil or raw honey).

But beyond mere mislabeling is a more insidious type of food fraud: creating inferior products meant to pass as brand-name goods.

With advances in technology, a localized market and the constant push for value pricing, it's not always easy to tell what's real and what's fake.

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Counterfeit Foods: Are You Eating the Real Thing?

By Kelli Grant, SmartMoney


"It's easy to sell a piece of fish as one species when in reality it's another species," says Kircher. Farmed fish also get advertised as more expensive wild versions. Sometimes, it gets even more creative than a simple mislabel. Scallops, for example, might actually be punched out circles from a whitefish fillet, she says. Faux fish represented the top fraud in the Journal of Food Sciences study of media and other public records, at 9% of cases. And some may be unhealthy. A recent Consumer Reports study included a "grouper" sample that was really tilefish, a species that contains enough mercury to make the FDA's list of foods that pregnant women and young children should avoid. Experts suggest buying whole fish when possible which are harder to fake.

Accounting for 16% of the database's recorded cases, olive oil is the food most subject to fraud, according to the Journal of Food Sciences study. In most cases, experts say, consumers are merely getting a bad deal -- regular olive oil instead of pricier extra virgin, say, or a less expensive variety from Greece instead of Italy as the label proclaims. But in rare cases, varieties of non-food-grade oil may be added in, posing a health risk, Steketee says. In one of the more famous cases, more than 600 people in Spain died in 1981 after consuming "olive oil" that was actually a non-food-grade rapeseed oil intended as an industrial lubricant. She suggests sticking to brands you know and sources you trust.


By Kelli Grant, SmartMoney

Adulterated milk is typically watered down and then laced with melamine, which increases the protein content to hide the dilution, Spink says. "Consumers may consume the product and may not be aware of the quality variation," he says. In fact, milk is the second most common ingredient subject to adulteration, at 14% of cases in the U.S. Pharmacopeial Convention's Food Fraud Database. The 2008 Chinese milk scandal was the most high-profile incident, with the resulting outbreak killing six infants and sickening more than 300,000 consumers. Steketee says the problem is still more widespread abroad, with U.S. consumers needing to be more cautious about powdered milk and similar products of unknown origin.


By Kelli Grant, SmartMoney

The Journal of Food Sciences study pegged honey as a top fake, representing 7% of food fraud cases. Last year, Food Safety News tests also found that 75% of store honey doesn't contain pollen. People are still buying a bee-made product, but all the pollen has been screened out, says Andrew Schneider, a food safety journalist who wrote the reports for Food Safety News. A lack of pollen makes it tough to determine its geographic origin -- and also means regulators don't recognize the product as honey, he says. Why the misdirection? Separate Food Safety News tests found a third of the faux honey imports from Asia were contaminated with lead and antibiotics. For the real deal, Schneider suggests buying from a local beekeeper. A National Honey Board spokesman says the group disputes the Food Safety News findings, and says regulations do allow for pollen to be filtered out as part of the removal of particles such as bee parts and other organic debris.


By Kelli Grant, SmartMoney

Fraudsters find it easy to dilute expensive juices without a notable change in taste or consistency, says Kircher. Orange juice represents 4% of cases in the U.S. Pharmacopeial Convention's Food Fraud Database, and apple juice, 2%. Consumers buying one of those common juices might get more water for their money, while an expensive one like pomegranate may be cut with apple juice. Consumers should be especially careful to read labels and pick a trusted brand when buying into the latest super-fruit craze, she says. It takes time to build up supply of a newly hot fruit, so those products are more likely to be adulterated.


By Kelli Grant, SmartMoney

Although not a top offender in the Food Fraud database, experts say baby formula poses considerable food fraud risk. Formula is one of the most common targets for organized retail theft http://blogs.smartmoney.com/paydirt/2011/06/09/how-criminals-are-ruining-your-shopping-experience/, and criminals often tamper with the sell-by codes to move expired product, Spink says. Adulterated milk, which can make it into formula, also poses a concern here, Steketee says. Parents' best bet, they say, is to buy from a major retailer rather than less-monitored venues such as flea markets and online auctions. And don't buy any package that has a blurred-out expiration date or otherwise looks tampered with, she says.


By Kelli Grant, SmartMoney

There's ample fraud opportunity in expensive goods that are purchased in small quantities and used in small doses as it's unlikely one's using enough to notice something isn't quite right, Spink says. Saffron represents 5% of food fraud cases and vanilla extract, 2%. Turmeric, star anise, paprika and chili powder each account for another 1%. Some are dangerous swaps, others, a waste of money. Shoppers buying paprika may be getting the flavorless leftovers of spices that have already been processed for extracts. Chinese star anise, for example, may be substituted with toxic Japanese star anise. Experts suggest being cautious about buying from markets or bulk bins without knowing the spice's origin.


By Kelli Grant, SmartMoney

Just a few weeks ago, a New York wine dealer was arrested for allegedly trying to sell rare -- but counterfeit -- wines for $1.3 million. Collectively, wines, spirits and liquors represent just 2% of cases in the USPC's Food Fraud database. Most faux wines are just a cheaper vintage and a bad bargain, but adulterated spirits are potentially more dangerous, says Steketee. Fake vodkas in particular have made the news in recent months, with contaminants such as anti-freeze and other dangerous chemicals. Counterfeiters are likely to focus most of their attention on the packaging, so consumers should keep an eye out for logos and bottles that don't look quite right, she says.


By Kelli Grant, SmartMoney

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Looks Can Be Very Deceiving

According to the Organization for Economic Cooperation and Development, the most successful food fraud occurs when the inferior item is not easily distinguishable from the real deal.

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With advances in technology, it's becoming markedly more difficult to determine a counterfeit label from a real one, even in the face of anti-counterfeit security devices like holograms or tax labels. Well-designed packaging (even creating fake "brands") also helps these goods gain traction, enabling them to blend well on store shelves because they don't stand out next to their legitimate peers.

Counterfeiters will make most of their upfront investment in label-making equipment, and less investment in the inferior ingredients going into the food items. Simply put, the more they spend on the outside, the less they'll spend on the inside.

"In most cases, food fraud, or 'economically motivated adulteration,' is a pocketbook issue," Ward says, "but when ingredients are illegally substituted for what is on the label, consumers may be affected by unsuspected allergens or, in the worst case scenario, by toxic contaminants such as melamine."

From Fake Baby Formula to Watered-Down Booze

Baby formula, Scotch whisky, vodka, and premium teas are among the easiest to fake. Items that have an imprinted logo, such as many candy bars, or are visually distinctive are typically harder, as more effort and costs are required in manufacturing. Frozen foods also run a lower risk of being fake, because the additional cost of transporting them cuts into potential profits.

Anyone who has ever been disappointed by a watered-down cocktail will appreciate that premium alcohol is particularly susceptible to fraud. Varieties that are commonly used in mixed drinks are especially attractive, because the mixer will hide the taste of the poor quality underlying alcohol.

In many cases, original bottles are used, but refilled with an inferior product. Casual consumers won't be able to detect the difference among various types of nearly identical looking and smelling beverages.

Most of those counterfeiters are small-scale operators. However, there have been reports of a few large operations that include bottling equipment and printing machines, and which produce their own raw, poor-quality alcohol, which is placed in replicated bottles of premium brands. These businesses, which sometimes span international borders, are almost always linked to organized crime.

10 PHOTOS
The Business Behind Counterfeit Foods
See Gallery
Counterfeit Foods: Are You Eating the Real Thing?

By Kelli Grant, SmartMoney


"It's easy to sell a piece of fish as one species when in reality it's another species," says Kircher. Farmed fish also get advertised as more expensive wild versions. Sometimes, it gets even more creative than a simple mislabel. Scallops, for example, might actually be punched out circles from a whitefish fillet, she says. Faux fish represented the top fraud in the Journal of Food Sciences study of media and other public records, at 9% of cases. And some may be unhealthy. A recent Consumer Reports study included a "grouper" sample that was really tilefish, a species that contains enough mercury to make the FDA's list of foods that pregnant women and young children should avoid. Experts suggest buying whole fish when possible which are harder to fake.

Accounting for 16% of the database's recorded cases, olive oil is the food most subject to fraud, according to the Journal of Food Sciences study. In most cases, experts say, consumers are merely getting a bad deal -- regular olive oil instead of pricier extra virgin, say, or a less expensive variety from Greece instead of Italy as the label proclaims. But in rare cases, varieties of non-food-grade oil may be added in, posing a health risk, Steketee says. In one of the more famous cases, more than 600 people in Spain died in 1981 after consuming "olive oil" that was actually a non-food-grade rapeseed oil intended as an industrial lubricant. She suggests sticking to brands you know and sources you trust.


By Kelli Grant, SmartMoney

Adulterated milk is typically watered down and then laced with melamine, which increases the protein content to hide the dilution, Spink says. "Consumers may consume the product and may not be aware of the quality variation," he says. In fact, milk is the second most common ingredient subject to adulteration, at 14% of cases in the U.S. Pharmacopeial Convention's Food Fraud Database. The 2008 Chinese milk scandal was the most high-profile incident, with the resulting outbreak killing six infants and sickening more than 300,000 consumers. Steketee says the problem is still more widespread abroad, with U.S. consumers needing to be more cautious about powdered milk and similar products of unknown origin.


By Kelli Grant, SmartMoney

The Journal of Food Sciences study pegged honey as a top fake, representing 7% of food fraud cases. Last year, Food Safety News tests also found that 75% of store honey doesn't contain pollen. People are still buying a bee-made product, but all the pollen has been screened out, says Andrew Schneider, a food safety journalist who wrote the reports for Food Safety News. A lack of pollen makes it tough to determine its geographic origin -- and also means regulators don't recognize the product as honey, he says. Why the misdirection? Separate Food Safety News tests found a third of the faux honey imports from Asia were contaminated with lead and antibiotics. For the real deal, Schneider suggests buying from a local beekeeper. A National Honey Board spokesman says the group disputes the Food Safety News findings, and says regulations do allow for pollen to be filtered out as part of the removal of particles such as bee parts and other organic debris.


By Kelli Grant, SmartMoney

Fraudsters find it easy to dilute expensive juices without a notable change in taste or consistency, says Kircher. Orange juice represents 4% of cases in the U.S. Pharmacopeial Convention's Food Fraud Database, and apple juice, 2%. Consumers buying one of those common juices might get more water for their money, while an expensive one like pomegranate may be cut with apple juice. Consumers should be especially careful to read labels and pick a trusted brand when buying into the latest super-fruit craze, she says. It takes time to build up supply of a newly hot fruit, so those products are more likely to be adulterated.


By Kelli Grant, SmartMoney

Although not a top offender in the Food Fraud database, experts say baby formula poses considerable food fraud risk. Formula is one of the most common targets for organized retail theft http://blogs.smartmoney.com/paydirt/2011/06/09/how-criminals-are-ruining-your-shopping-experience/, and criminals often tamper with the sell-by codes to move expired product, Spink says. Adulterated milk, which can make it into formula, also poses a concern here, Steketee says. Parents' best bet, they say, is to buy from a major retailer rather than less-monitored venues such as flea markets and online auctions. And don't buy any package that has a blurred-out expiration date or otherwise looks tampered with, she says.


By Kelli Grant, SmartMoney

There's ample fraud opportunity in expensive goods that are purchased in small quantities and used in small doses as it's unlikely one's using enough to notice something isn't quite right, Spink says. Saffron represents 5% of food fraud cases and vanilla extract, 2%. Turmeric, star anise, paprika and chili powder each account for another 1%. Some are dangerous swaps, others, a waste of money. Shoppers buying paprika may be getting the flavorless leftovers of spices that have already been processed for extracts. Chinese star anise, for example, may be substituted with toxic Japanese star anise. Experts suggest being cautious about buying from markets or bulk bins without knowing the spice's origin.


By Kelli Grant, SmartMoney

Just a few weeks ago, a New York wine dealer was arrested for allegedly trying to sell rare -- but counterfeit -- wines for $1.3 million. Collectively, wines, spirits and liquors represent just 2% of cases in the USPC's Food Fraud database. Most faux wines are just a cheaper vintage and a bad bargain, but adulterated spirits are potentially more dangerous, says Steketee. Fake vodkas in particular have made the news in recent months, with contaminants such as anti-freeze and other dangerous chemicals. Counterfeiters are likely to focus most of their attention on the packaging, so consumers should keep an eye out for logos and bottles that don't look quite right, she says.


By Kelli Grant, SmartMoney

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Because of the difficulty and expense of transporting large quantities of alcohol in glass containers, most counterfeiting operations are local ones, with the counterfeiters selling directly to local liquor stores or bars. The proprietors may mark up the price to such a level that, between the nearly identical bottle and price of a premium brand, it could be impossible to tell the difference. Because these batches are typically smaller than the large international shipments that are subject to customs inspection, they're often harder for officials to detect. And when the counterfeiters are caught, the small quantities of fake product make prosecution less likely, and any penalties or fines are smaller.

So scan your shopping cart with skepticism. While it may be nearly impossible to tell a fake from the real thing, the same rule of avoiding counterfeit purses applies: Use common sense, don't buy an item with a label that has spelling errors or misprinted labels, and be wary of prices that seem too low.

Customers who suspect they've bought a fake food or beverage item can contact the FDA's hotline at 888-SAFEFOOD or consumer@fda.gov.


Molly McCluskey is a regular contributor to The Motley Fool. Follow her finance and travel tweets on Twitter @MollyEMcCluskey.
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