Health

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Health Consumer Protection Directorate General

• Better Training for Safer Food
• 2008

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Training Course on checks in Border Inspection
Posts
Rotterdam, 27-30 May 2008
Trade patterns and Fraud
Neil Brooks BVMS
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Trade patterns and Fraud

• Trends in certain commodities
• Effects of Disease on these
• Effect that has for disease transmission
• Incentive to fraud
• Risk indicators

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World Meat Production a historical perspective,
1990-2005
Driven by Gains in Poultry/Pork Sectors
Growth in Developing Countries
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Bovine Production Surplus
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Small Ruminant Production Surplus
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Porcine Production Surplus
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The EU The Story of a Rising Meat Importer
Beef 520,000 Ovine 230,000 Pigmeat
80,000 Poultry 600,000
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Turns EU into net beef importer
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Comparing Beef Prices Incentive to Import
OECD, FAO price data
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Comparison of exports from China and declared
imports by EU Member States for Vegetables, Frozen
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Introduction via Air Travel

• Steady flow of animal products
• about 5 kg on average
• by 1 - 5 of travellers from Asia or Africa
• may amount to some 2,000 tons per year
• Largest numbers of passengers enter EU from the
  Far East and the Near East Middle East
• Largest numbers destined for
• UK Far East and Near East Middle East
• France North Africa and Far East
• Germany Far East

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Trade patterns and Fraud

• Legal Trade
• Risk Analysis
• Risk Management
• Risk Communication
• Illegal trade
• Unkown quantity(ies)

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Trade patterns and Fraud

• Risk Analysis
• Based upon observance of legislation by traders
• Accurate and informed assessment of all
  information
• Commission approval of source country
• Content of EC certificates agreed
• Certification procedure can be relied upon
• Risks for fraud / illegal imports
• Quite different variety
• Personal illegal imports
• Commercial illegal imports

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Trade patterns and Fraud

• Risk analysis
• Hazard identification in third country
• Release assessment
• Exposure assessment
• Consequences assessment
• Risk estimation - combination of the above

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Trade patterns and Fraud

• Risk management and Communication
• Management - Commission proposals and
  framework
• Discussed and agreed with MS
• Import conditions
• Risk Communication Informing
• Operators,
• Enforcement authorities
• The public

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Trade patterns and Fraud

• Animal and Public Health Risks
• Different approach
• Risk control AH linked largely to Certification
  and Documentation
• Origin and probity of source critical
• Risk Control PH also dependant upon controls in
  third country
• More susceptible to identity and physical checks
  for assessment
• No system of controls can be 100 effective

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Trade patterns and Fraud

• Fraud / illegal imports
• Easier (theoretically ) to target personal
  travellers
• Involuntary errors
• Ignorance of the legislation
• UK government 25M (2003/4,2004/5,2005/6)
• Tackle personal illegal imports
• Allocation included in HMRCs funding for the
  future
• 4,500 HMRC Staff . All anti smuggling
  responsibilities
• 10 Meat detector dog operation
• Seizures up

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Trade patterns and Fraud

• More difficult to deal with Commercial Fraud
• Organised Crime
• Very sophisticated
• Often one jump ahead of authorities
• UK now turning to this aspect of trade
• Need to carry out risk assessments of import
  consignments, trade patterns at your location
• Customs and Health authorities need to work
  closely together on this

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Some Risk factors affecting your approach

• Customs services / OLAF have a long list of risk
  factors for fraud.
• Note the different approach for customs and
  health (veterinary services)
• Customs looking for revenue, and time does not
  always matter to resolve problems
• Veterinary services looking for disease
  control. Time is of the essence, money is
  secondary provided resource is available
• Health services do not always take sufficient
  account of the economics of the trade

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Main Veterinary Risk factors (PH/AH )

• New Trader v Old established trader
• New Commodity Trade
• New establishment
• Eventful history of previous trade
• Country of origin not a favoured partner
• Recent isolations of Pathogens or contaminants
  in similar products
• Current alerts or reinforced checks procedures in
  place from this or similar source/product/establis
  hment
• (Traces may be used to assist this process)

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Customs services ----- Risk factors

• Have a comprehensive list of factors to take into
  account
• Each category is graded for importance greater
  risk
• Red, Amber, Blue, or white
• The summation and assessment of all these risks
  is a key factor in targeting consignments to be
  looked into.
• Intelligence the key word
• Need to keep good records to see what is happening

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Some Customs Fraud Risk factors - I

• Case details Tip off / notification
• Consignee Details
• Shipper /Consignor
• Notification process
• Importing Company
• Customs Entry
• Invoice
• Delivery instructions
• Port of loading

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Some Customs Fraud Risk factors - II

• Transhipment
• Goods themselves
• Payment methods
• Container
• Bill of lading
• Port of Discharge
• Container status
• Weight / Cube
• Marks and numbers
• Routing

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Risk factors - III

• These can be reduced/ refined in the veterinary
  field
• Mis certification (mulitiple certificates)
• Mis description
• Mis identification.
• NB the levels of physical checks laid down in CD
  94/360/EC are not allied to any scientific
  assessment of veterinary risks involved in the
  trade in the different commodities listed
• Levels of checks originally empirical
• Good case for changing these
• Problem is to achieve a flexible responsive
  system that takes care of real AH and PH risks
  whilst leaving resources for fraud
  investigation
• Frequently seen as a customs problem not a
  veterinary problem

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Trade patterns and Fraud

• Prevention - key factors
• Close cooperation between Customs and Veterinary
  services necessary
• Phyto sanitary services may also have to be
  involved
• Other foods may be implicated , vets may deal
  with this
• Veterinarians of CA largely deal with legal
  traders
• Illegal traders usually the remit of the customs
  services in many Member States
• Different perception of the position centrally
  and locally .
• Much depends upon the local interaction between
  customs and veterinarians on the ground

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Trade patterns and Fraud

• Customs Veterinary cooperation
• Informal contact important
• More formal memos of understanding between
  services a good way forward
• Regular local contact, meetings
• Access to data on Customs data bases useful but
  too much often for veterinary services
• Also confidential may be legal restraints
• Assess all available local information and
  intelligence
• Target certain types of container if all seems
  not correct.
• Even them some information comes by hazard

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Trade patterns and Fraud

• Conclusions Checking for Fraud
• Use all available sources of information
• Essential to look at the bigger picture
• Look at records to follow trends
• Work closely with other services customs
• Be alert for the unusual
• In documentary checks look at all available
  documentation Bills of lading etc to cross
  check with vet certificates for anomalies and
  inconsistencies