Complex supply chains leave industry open to fraud

Professor Chris Elliott says that evidence of fraudulent practices is difficult to detect in cold stores. Credit: Lotus Head/CC BY-SA 3.0 Professor Chris Elliott says that evidence of fraudulent practices is difficult to detect in cold stores. Credit: Lotus Head/CC BY-SA 3.0

Last year’s horsemeat scandal in the UK illustrated the ease with which criminals could target the food industry and make huge profits as they did so.

An official interim report to review the integrity and assurance of food supply networks by Professor Chris Elliott of Queen’s University in Northern Ireland, states that the emphasis on providing cheap food has led to complex supply chains which are ripe for fraudulent activity.

“I believe criminal networks have begun to see the potential for huge profits and low risks in this area,” he said. “A food supply system which is much more difficult for criminals to operate in is urgently required.”

Professor Elliott singled out two areas where the meat industry, and this applies equally to the fish industry, is particularly vulnerable – the buying and selling of meat by traders and brokers, and the storing of frozen meat in cold-stores.

“Traders and brokers will buy and sell meat of any quality or quantity,” Professor Elliott said in his interim report, which was published on 13 December. “Most traders don’t have physical possession of the meat that they buy and sell. They trade from an office, even over a mobile phone, while the meat will more than likely be held in a cold-store.

“They may never own the meat, but merely arrange the deal.”

For the most part, their main concern will be price, he said, and a number of traders and brokers appear to be indifferent to whether they are trading in authentic or inauthentic meat.

Vulnerable
Traders and brokers are highly vulnerable links in the supply chain of meat, according to Professor Elliott. “Information from a number of sources indicates that large amounts of meat of dubious origin and quality remains available for purchase through traders and brokers.”

The ever increasing pressures to keep the costs down can cause careless procurement practices, or simply a need for a cheaper product allows this material to enter the UK food system. “Some of this meat may well not be fit for human consumption.”

On the subject of cold-stores, Professor Elliott stated that the type and species of meat stored is at the owners’ discretion, “so they can store meat of all kinds from a number of different sources, from several species and from one or several suppliers”.

He pointed out that cold-stores are assumed to be lower-risk than manufacturing or processing plants for inspection purposes.

“Inspections that do take place,” he said, “also present practical difficulties when attempting to detect fraud; they may be announced, and not usually fraud-aware. Both local authority and private sector audits are generally more concerned with food hygiene and safety than with fraud.

“In both cases even if they were looking for it, evidence of fraudulent practices would be extremely difficult to detect. At minus 18ºC, the environment for inspection is also extremely inhospitable. A lot of stored material is not easy to access without fork lift trucks, and there is ample opportunity both to hide suspect material and to make thorough inspection inconvenient.

“As a result, for most of the time, any operation undertaking fraudulent activities could undertake thawing, re-freezing, re-packaging, re-labelling and re-strapping out of hours and at weekends, and carry on without any great fear of detection.”

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