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