Food fraud study in the UK estimates costs to economy

Food fraud is costing the UK economy up to £2 billion every year, according to a study from the University of Portsmouth that calculated the economic impact. The study examined food fraud such as food substitution, false labelling and document fraud, where products are deliberately misrepresented for financial gain.

Published in the Journal of Economic Criminology, the research also captures the wider impact on the legitimate food industry, including the loss of sales when fraudulent products displace genuine ones.

“One of the most encouraging findings from this research is that the UK’s food industry has developed systems that make fraud significantly more difficult than in many other sectors. Businesses, regulators and assurance schemes work together to create barriers that prevent fraudulent products entering legitimate markets,” said Professor Lisa Jack, School of Accounting, Economics and Finance at the University of Portsmouth.

While food fraud remains comparatively uncommon because of the extensive checks built into food supply chains, the researchers say this is not a reason for complacency.

The study found that around three-quarters of the total economic cost comes from the direct replacement of legitimate products with fraudulent alternatives, such as the marketing of smoked salmon as Scottish despite being sourced in Norway.

Although consumers may never realise they have been deceived, the researchers say the consequences can include financial losses for businesses, damage to confidence in food supply chains and, in some cases, serious risks to public health, for example, fake spirits that contain industrial chemicals.

The researchers hope the findings will provide a framework to help governments and industry target resources more effectively and strengthen the resilience of food supply chains against organised criminal activity.

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