Food fraud is costing the UK economy up to £2 billion every year, according to the first study to calculate its full economic impact. The research, from the University of Portsmouth, estimates that food fraud costs between £400 million and £2 billion annually, making it one of the country's most expensive forms of economic crime.
The study examines offences including food substitution, false labelling and document fraud, where products are deliberately misrepresented for financial gain.
Published in the Journal of Economic Criminology the research introduces a new way of measuring the cost of food fraud by looking at entire criminal operations rather than individual incidents. It also captures the wider impact on the legitimate food industry, including the loss of sales when fraudulent products displace genuine ones.
The researchers 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 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 .
Food fraud is not just about consumers paying for something that is not what it claims to be. It undermines honest businesses, distorts markets and, in the most serious cases, puts people's health at risk.
Dr David Shepherd, School of Criminology and Criminal Justice at the University of Portsmouth
Dr David Shepherd , from the School of Criminology and Criminal Justice at the University of Portsmouth, said: "Food fraud is often perceived as a niche issue, but our findings show it has a substantial economic impact on the UK. It is not just about consumers paying for something that is not what it claims to be. It undermines honest businesses, distorts markets and, in the most serious cases, puts people's health at risk.
"By measuring the full economic cost, we can better understand the scale of the problem and make stronger evidence-based decisions about where enforcement and prevention efforts should be focused."
Unlike many other forms of fraud, the researchers suggest food fraud remains comparatively uncommon because of the extensive checks built into the UK's food supply chains. They say that collaboration between regulators, manufacturers, retailers and certification bodies has created multiple layers of quality assurance that make it much harder for rogue traders to operate.
Professor Lisa Jack , School of Accounting, Economics and Finance at the University of Portsmouth, said: "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.
"However, this is not a reason for complacency. Continued investment in prevention and enforcement is essential if we are to maintain public confidence in the food we buy and protect businesses that play by the rules."
The study also suggests that investing in food fraud investigations could generate significant economic benefits. Based on the cases analysed, the researchers estimate that prosecutions may deliver a return on investment of more than 400 per cent, indicating that stronger enforcement could pay for itself while reducing harm across the food system.
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.
Professor Lisa Jack, School of Accounting, Economics and Finance at the University of Portsmouth
The findings provide policymakers with the first evidence-based estimate of the true cost of food fraud in the UK and offer a framework that can be refined as better data become available. The researchers hope this will help governments and industry target resources more effectively and strengthen the resilience of food supply chains against organised criminal activity.
