Organic Fraud in the Marketplace – What it Means for You

The organic industry has been peppered with a spate of news about a few bad actors trying to sell conventional products as organic. Most notably, containers of fraudulent soybeans were found entering the US market from Eastern Europe through Turkish exporters.

This, of course, is bad for US producers who have to compete with prices created from a false supply chain.

It is also bad news for the organic industry as a whole. Every vitriolic headline casts doubt and uncertainty in the heart of the organic consumer.

How rampant is this cheating problem?

The USDA compiles a list of Fraudulent Organic Certificates that have been identified and suspended from the organic supply chain. In 2017 alone, 42 fraudulent certificates were published by the National Organic Program (NOP). These illegal certs originate from across the globe: Vietnam, Denmark, Mexico, Thailand, Cameroon and yes Turkey.

Despite the fact that falsely representing products as certified organic violates the law and is punishable by fines of up to $11,000 for each violation, the list continues to grow. The financial temptation to cheat is greater than the punishment – especially when it comes to imports.

How the organic industry responds is as important as catching the individuals so the organic seal remains the strongest label in the marketplace.

The Organic Trade Association (OTA) immediately convened a Global Organic Supply Chain Integrity Task Force to develop a best practices guide to help buyers and importers mitigate the risk. I sit on this task force made up of buyers, suppliers, certifiers and traders who are all working to strengthen record-keeping and verification systems for organic certification. As of yet, these best practices are voluntary.

It will take more than voluntary measures to stem the tide of illegal imports.

Last September, OTA helped craft the bipartisan Organic Farmer and Consumer Protection Act, which aims to improve the oversight of global organic trade and increase funding for compliance and enforcement at the NOP.

If passed this legislation would:

• Authorize funding for the National Organic Program to keep pace with organic industry growth.
• Provide one-time funding for technology systems to modernize and improve international trade tracking systems and data collection.
• Improve effective oversight, robust investigations, and enforcement across the entire supply chain.
• Direct coordination and access to available cross-border documentation systems administered across other federal agencies and departments;
• Require USDA to close regulatory loopholes by mandating that uncertified entities, such as ports, brokers, importers and online auctions, become certified;
• Require USDA’s National Organic Program to issue an annual compliance report to Congress, which would include domestic and overseas investigations and actions taken.

Organic fraud must be addressed in the upcoming Farm Bill.

Congress is already writing the precursors of what will be one of the largest pieces of legislation once passed. The Farm Bill has a direct effect on farmers’ livelihoods and largely determines what food is grown and eaten in this country. It can also provide protection for the organic seal.

 

OTA’s Farm Bill Priorities firmly call out a need to have stronger oversight in organic trade.

In addition to increased funding for NOP, they ask for the elimination of paper documents and a move to electronic import certificates.

And the Farm Bill should include measures for better collaboration between the NOP and the trade.

There should be coordinated access to cross-border documentation systems administered across other agencies. US Customs and Border Protection’s (CBP) Automated Commercial Environment (ACE) and Animal and Plant Health Inspection Service (APHIS) phytosanitary certificates and the NOP must all be communicating.

What does Organic Fraud mean for you?

If you are a certified organic producer, you need to have the assurance that you are selling your products in a fair and equal market. Even one container of fraudulent organic soybeans, mangoes or tomatoes can affect your ability to get a fair price.

If you are an organic distributor, retailer or broker, it’s imperative to your integrity to be up to date on fraudulent activity and check the list of fraudulent certificates on a regular basis. Sign up for the Organic Insider email notification to receive important NOP updates including fraudulent activity.

If you are an organic consumer, you deserve the assurance that when you see the organic label, you are paying a premium for product that is inspected and certified to be grown and processed with the highest standards and transparency.

If they haven’t already done so, ask your representative to sign on and cosponsor the Organic Farmer and Consumer Protection Act. Then get vociferous about the upcoming Farm Bill.

Finally, anyone suspecting a violation of the organic regulations can report a complaint to the NOP compliance and enforcement division.

Together we can stem the tide of illegal activity and keep organic as the most trusted label in the store.