Fraud Prevention

Reporting Organic Fraud

Posted on by SOS_Admin

By SOS Founding Partner, Kim Dietz

Strengthening Organic System (SOS) was founded with the mission:

“To advise organic businesses in organic compliance to prevent organic fraud and ensure supply chain integrity. In response to the new Strengthening Organic Enforcement Rule, SOS is dedicated to services that will continue to assure authenticity of organic products, protect organic businesses from organic fraud, and maintain consumer confidence in the USDA organic seal.”  

This blog focuses on how to report organic fraud and the importance of collaboration among all stakeholders in the organic supply chain to prevent fraud and maintain the integrity of the USDA organic seal. It discusses the role of the USDA, the definition of organic fraud, the responsibilities of certified organic operations, and the impact of fraud on consumers, and it outlines the steps to take if organic fraud is suspected. It emphasizes the importance of reporting fraud to protect the organic market and provides links to relevant sources.  

The role of the United States Department of Agriculture (USDA)

In March 2024, the USDA’s Strengthening Organic Enforcement (SOE) rule resulted in the biggest update to the organic regulations since the original Act in 1990. The purpose of the regulation is to provide a significant increase in oversight and enforcement authority and to reinforce the trust of consumers, farmers, and those transitioning to organic production. The SOE rule has many provisions in place to protect organic integrity and bolster consumer confidence in the USDA organic seal. 

  • Reduces the number of uncertified entities in the organic supply chain.
  • Requires the use of electronic import certificates
  • Strengthens recordkeeping and supply chain traceability
  • Clarifies authority to oversee and enforce organic trade
  • Strengthens oversight of accredited certifying agents

What is the definition of Organic Fraud?

Organic Fraud is defined under 7CFR205.2 as:  

Deceptive representation, sale, or labeling of nonorganic agricultural products or ingredients as “100 percent organic,” “organic,” or “made with organic (specified ingredients or food group(s)).”  

Certified Organic Operations

The SOE final rule requires that all certified operations maintain and implement practices to verify the organic status of suppliers and products in their supply chain and to prevent organic fraud. Collectively, these practices are often called “fraud prevention plans.” The fraud prevention plan must be included in an operation’s Organic System Plan (OSP). 

These plans must include a description of the practices and procedures to:

  • Identify suppliers in your supply chain and the organic status of agricultural products received 

• Prevent organic fraud 

• Monitor the success of your OFPP  

• Report instances of fraud

The Consumer

U.S. Organic marketplace sales hit $69.7 billion dollars in 2023, according to the 2024 Organic Industry Survey from the Organic Trade Association.  This very enticing market is known to have higher costs of goods, which are often in high demand and limited supply.  These factors are what drive the bad actors to commit fraud.  A strong organic fraud prevention plan and supply chain integrity are key to protecting the consumer. 

What to do if you suspect Organic Fraud

Anyone who suspects a violation of the USDA organic regulations can and should file a complaint. 

When you report an alleged violation, you must provide as much information as possible to ensure a thorough investigation. 

REMEMBER: Complaints that are never submitted cannot be investigated! 

Reporting Organic Fraud

Every certified operation is now required to have a procedure in place for their employees, vendors, and entire supply chain on how to report organic fraud.  

IF YOU SUSPECT OR DETECT FRAUD: Collect evidence – invoices, bill of lading, emails, images, packaging, video, photos, samples (retain sample if applicable). Confirm evidence is present. If suspicion is present but evidence does not support proof of fraud, collect supportive evidence and submit as a complaint. 

o Submit the complaint report, with evidence, to the competent authority (e.g., USDA-NOP), your own certifying agent, and the supplier’s certifying agent (if applicable). 

o Reject or Hold product for investigation – rejected product returned to vendor/ supplier/  producer-whether returned or held, ensure the product is not used for organic production. 

o Keep a record of complaint submittal. 

THE PROCESS FOR REPORTING FRAUD  

Organic Fraud is a violation of the USDA National Organic Program (NOP) regulations. If fraud is detected, a complaint submittal supports market security and integrity. Additionally, the NOP  regulations mandate that operations provide notification to an operation’s certifying agent concerning any change in operation that may impact compliance per 7 CFR 205.400(f). Therefore, an operation’s certifying agent should be notified of potential fraud or compliance concerns upon discovery. 

The complaint must be written, verifiable, and accompanied by evidence demonstrating fraud or the violation alleged.  

Complaints should be submitted to the appropriate entities (including USDA and the Certifying Agent)  through the following links: 

Optional Reporting Resources: 

Need help from SOS on submitting complaints?

For SOS, we are dedicated professionals who are passionate about how we can help to assist in reporting fraud. We can provide guidance, help collect and organize the information that will result in an actionable submission, and, if needed, ensure your identity remains anonymous. 

Click the link here for assistance from SOS on reporting fraud: Report – Strengthening Organic Systems