The USDA’s National Organic Program completed more complaint reviews and investigations that it received in 2017. It finished work on 462 reviews and investigations while receiving 379 incoming complaints during the fiscal year 2017 ending last Sept. 30.
Under the jurisdiction of USDA’s Agricultural Marketing Service, the organic program recently updated reports on enforcement activities and fraudulent organic certificates for 2017. It’s been a year of business growth for organic growers and producers.
Organic sales topped $68.8 billion on the steady growth of about 5 percent a year. More than eight out of ten households made organic purchases. And 4.1 million acres out of 915 million acres of U.S. farmland was reportedly dedicated organic production on about 15,000 farms.
However, the National Organic Program’s (NOP) weak controls over organic imports, again came under scrutiny from USDA’s Office of Inspector General, putting the integrity of the USDA organic label at risk. The OIG found produce shipments of all kinds are fumigated at the border with pesticides to prevent pests from entering the U.S. And, a weak import certificate system imposed by NOP in 2012 has not prevented organics for getting the same treatment.
NOP’s most substantial enforcement action in 2017 came against a Texas corn chip manufacturer. Irving-based Xochiti, a formerly certified organic company, initially accepted a two-year suspension and was ordered to pay a $1.8 million civil penalty under a Consent Decision and Order by a USDA administrative law judge.
Xochiti is allowed to seek reinstatement to the organic program. The NOP reduced the civil penalty to about a fourth of the $!.8 million, leaving Xochiti to pay $475,000. Xochiti cannot sell organic products while on suspension.
Other civil penalties imposed by the NOP during 2017 totaled only $187,500.
USDA’s organic program also reports businesses using fraudulent organic certificates. It is currently highlighting seven organic companies it claims are using fraudulent organic documents including:
- Aurora & Sear Cooperative
- J and Sharp Holdings Pty Ltd.
- Kingsport Foods
- Xuzhou Hnest Pharna Trading Co., Ltd.
- T. Shihom Development Trading Company
- Vellela Group of Companies Pty Ltd.
Spellings of the company names are as found on the certificates. The certificates falsely represent agricultural products as certified under the USDA organic regulations, which NOP says violates the Organic Foods Production Act of 1990
In addition to those highlighted, NOP keeps an Excell spreadsheet listing nearly 100 fraudulent certificates it is tracking.
“Fraudulent certificates may have been created and used without the knowledge of the operator or the certifying agent named in the certificates,” according to NOP.
“The posting of the fraudulent certificates does not necessarily mean that the named business or certifying agent was involved in illegal activity. If a business named on the fraudulent certificate is certified, its certifying agent, identified in the list of certified operations, can provide additional information and verification to the organic trade.”
The NOP, which can impose civil penalties of no more than $11,000 per violation, says “the organic trade is the vital force in ensuring organic integrity.” It urges organic handlers to review certificates.
During the fiscal year 2017, the NOP suspended 294 certificates and revoking another 17. It negotiated settlement agreements with 33 organic businesses and obtained consent decisions involving two others.
NOP referred 162 cases for further investigation and issued warnings to 100 others.
According to the NOP, common consumer complaints about organic food sales include:
- Using the USDA organic seal without being certified organic
- Using the word “organic” on the front of the package when the ingredients are organic, but the entire product is not certified organic
- Using the USDA organic seal on a multi-ingredient product that only has only a portion of organic ingredients, less than 95 percent, of the total product
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