UK partnership plans food fraud study for 2017

The Chartered Institute of Environmental Health and partners are planning a study next year to look at how well the UK food industry copes with fraud.

The study will draw upon the principles in the CIEH's recently-published report entitled Counter fraud good practice for food and drink businesses, and is intended to provide an assessment of the resilience against fraud of food and drink companies.

Report co-author Eoghan Daly – formerly at the CIEH but now working for Crowe Clark Whitehill LLP on a forensic and counter fraud team – told that the study is a continuation of the work that went into the guide, and will initially take the form of an industry survey and case studies to provide a deep dive into current practices.

Eventually the intention is to pilot the good practices detailed in the guide, which were drawn up by the CIEH in collaboration with the University of Portsmouth’s Centre for Counter Fraud Studies, the Food Standards Agency's National Food Crime Unit, Food Standards Scotland's Food Crime and Incidents Unit, and the Intellectual Property Office.

The intention is to help meet some of the NFCU recommendations for industry, in particular a greater focus on prevention and evidence-gathering and building a business case for tackling fraud – which can leads to financial costs, undermined consumer confidence and potentially deleterious effects on public health and wellbeing.

"Food businesses do not have the evidence they need to gauge the impact of fraud," said Daly, pointing out for example that if detection rates go up it can be hard to interpret whether this is caused by greater fraud or more efficient identification of cases. It is estimated that counter fraud measures account for around 5 per cent of industry expenditures at the moment.

"They need to change their approach and adopt good practice in counter fraud as a key element of day to day business, before profits are hit and they lose customers," said Daly. While food companies may be working effectively in some areas such as laboratory testing and authentication, they may be weak in other areas, for example supply chain visibility and security.

CIEH's guide makes a number of recommendations, including a need for businesses to calculate the cost of fraud using reliable metrics, adopt a centralised approach to counter fraud and conducting regular drills to make sure they are prepared to tackle fraud incidents. Companies that do so can cut the cost of anti-fraud measures by 40 per cent, it suggests.

"Fraudsters work hard to hide their activities, making the worst, and most costly, scams subtle and difficult to detect," said Daly.

"This means that the number of potential frauds is practically unlimited and once one type of fraud is successful other vulnerabilities may be exploited."

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