How wine and food scam artists fool consumers and investors with phony labels and misleading information: Internet Scambusters #396
A wine or food scam works by providing false or misleading information, usually on the label of a product.
Sometimes it's perfectly legal and preys on our lack of understanding about how the contents are made or described; other times the scammers just make false claims and the product is not what the label says it is.
In this issue we will explain what you need to know to avoid wine and food scams.
Let's check out today's...
Can You Trust That Label -- Or Does It Hide a Food Scam?
A wine or food scam may be one of the lesser-known con tricks, but it's widespread and costs both consumers and investors a small fortune.
The basic trick is to pass off a product as something it's not. That could be anything from a bogus bottle of rare, vintage wine to a chemical-laden cauliflower masquerading as organic produce.
Unfortunately, despite efforts by law enforcement and government agencies, the scammers continue to pull their tricks.
Let's take a look at the most common wine and food scams:
Organic food scams
Some top names in the grocery retailing business, as well as meat and vegetable producers, have been caught and cited for claiming and labeling food as organic.
The reason is simple: Organic foods are more expensive. They often actually cost more to produce, but if you sell something as organic that isn't, then that additional "cost" goes straight into your pocket.
Sometimes the deception isn't intentional. Supermarket chains often have to rely on trust when they buy organic items from produce merchants, even stuff they may subsequently package themselves
Plus, there's often confusion about what qualifies as "organic." Here's what the US Department of Agriculture says:
"Organic food is produced by farmers who emphasize the use of renewable resources and the conservation of soil and water to enhance environmental quality for future generations. Organic meat, poultry, eggs, and dairy products come from animals that are given no antibiotics or growth hormones. Organic food is produced without using most conventional pesticides; fertilizers made with synthetic ingredients or sewage sludge; bioengineering; or ionizing radiation.
"Before a product can be labeled 'organic,' a government-approved certifier inspects the farm where the food is grown to make sure the farmer is following all the rules necessary to meet USDA organic standards. Companies that handle or process organic food before it gets to your local supermarket or restaurant must be certified, too."
Got that? If you hunger for more, visit the USDA National Agricultural Library.
The best way to increase the likelihood of buying and eating genuine organic products (you can never be 100% sure) is to look for the USDA Organic seal -- a circle with "USDA" in green on a white background, and "Organic" below in white on a green background.
This signifies a product has at least 95% organic ingredients. With content of more than 70% organic, the label can state only "Made with organic ingredients," while anything less than this may state "Organic ingredients." We know of no designation for 100% organic ingredients.
If the logo isn't there, you can't be sure the product has organic content.
Beyond the food label
A manufacturer or retailer would argue that not telling the whole truth on a food label is okay, as long as it's within the law.
But to our minds, if the label misleads the public, intentionally or otherwise, that's not okay.
For instance, a product with less than half a gram of fat per serving can still be described as "fat free."
And products containing below certain levels of other ingredients considered unhealthful in excess, like saturated fat, trans fat or sodium (from salt) can still claim to be "free" of that ingredient or to have "low" content.
Even though some of the quantities might be relatively small, over a period of time we are actually ingesting quite a lot of them!
This is compounded by allowing manufacturers and producers to use words like "health" or "energy" or declaring "no added sugar" when all this means is that the products meet certain legal definitions of these terms.
It does not necessarily mean they're good for you!
Packaging can mislead by using a points-scoring systems or symbols which the US Food and Drug Administration says may prompt consumers to not even check the nutrition labels.
Unless the law changes, or producers voluntarily tell the whole truth about what's in their products (and we wouldn't advise you hold your breath!), there's not a great deal you can do beyond educating yourself.
The important thing is to be aware. Always check the nutrition labels on the products you buy. Or, if there are no labels, as with fresh produce, check their contents (sugar, for example, online).
And if you have specific concerns about the actual content of labeled products, contact the manufacturer's customer service department, whose details usually appear on the label.
Wine industry experts reckon that something like one in every 20 bottles of fine wine sold today is relabeled and phony.
Fortunately, that likely isn't a concern for most of us since the victims in these type of scams are usually vintage wine collectors. In that realm, bottles exchange hands for many thousands of dollars.
Yet, wine scams do trickle down to the ordinary consumer. In a famous recent case, one of California's biggest vintners was hoodwinked into buying bulk quantities of French "plonk" (cheap wine), which it unknowingly bottled and resold under a popular label on supermarket shelves.
Also, it's not unknown for unscrupulous growers (or even restaurateurs) to water down wine, or add ingredients to increase alcohol or sugar content.
And, in another incident, investors were conned into handing over money for a fund that was supposed to buy up stocks of vintage wines, and "lay them down" while they appreciated in value.
Plenty of investors plunged in but there was no pool of wine!
The trouble is that, unless you're a wine expert, you can easily be conned by these tricks. Our advice is that if you like to buy fine, expensive wines, buy from a reputable dealer. And if you plan to invest, go with an expert who has an established reputation.
Unlike many of the con tricks we cover here at Scambusters, a wine or food scam is a lot more difficult to spot, but at least by knowing they're out there -- and happening on quite a scale -- you use more caution. Bon appetit!
That's all for today -- we'll see you next week.