
The Honey Launderers: Uncovering the Largest Food Fraud in U.S. History - acdanger
http://www.businessweek.com/printer/articles/153774-the-honey-launderers-uncovering-the-largest-food-fraud-in-u-dot-s-dot-history?src=longreads
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ck2
The largest food fraud in the US is not honey. It is the corporate farming
conglomerates who take government welfare to not grow any crops at all many
years.

$11 BILLION taxpayer money paid to not grow crops since 2003. Seriously,
google it.

That and massive subsidies for ethanol from corn. Most massive scam in US
history.

Oh and they de-coupled foodstamps from corporate welfare now so expect this to
become more insane over the rest of the decade.

~~~
zeckalpha
Actually, if the corporate farmers grew the same crops in the field year after
year, the land would eventually not be arable. This payment allows for the
land to recover from the disastrous methods the corporate farmers use.

~~~
markdown
> Actually, if the corporate farmers grew the same crops in the field year
> after year, the land would eventually not be arable.

So you reckon corporate farmers, left to their own devices, will destroy their
own ability to grow crops?

~~~
willvarfar
Happens all over the world that short termed farming leads to massive long
term damage. Dust bowl etc.

Farming always focuses on the current and next year.

~~~
markdown
> Farming always focuses on the current and next year.

Citation needed.

I'm a (admittedly small-scale) farmer myself, and I've yet to meet a farmer
who had that mindset. Further, I simply can't see a good reason why a farmer
would destroy his most precious asset - his land.

~~~
mordae
Because it's cheaper to get a new one. If you don't happen to have your house
nearby, plan to live there for next fifty years and want to raise kids.

It's normal for corporations to destroy arable land in Czech Republic too,
they can always move elsewhere...

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fnordfnordfnord
I'm all for harsh punitive measures for (convicted) business-crooks, but are
these SWAT raids on peoples' businesses (and homes) ever a good idea? What
good can come from a bunch of stormtroopers bum-rushing an office?

~~~
porpoisemonkey
I'm not sure where you got the idea that these raids were conducted by SWAT
teams. The article only vaguely alludes to "federal agents".

~~~
dredmorbius
In bulletproof vests. Presumably heavily armed.

~~~
porpoisemonkey
I don't think that just because they were wearing bulletproof vests you can
reasonably infer "SWAT". Many law enforcement agencies have written or
unwritten requirements to wear bulletproof vests when in the field.

[http://www.bja.gov/Publications/PERF_BodyArmor.pdf](http://www.bja.gov/Publications/PERF_BodyArmor.pdf)

"Our first main finding was that almost all law enforcement agencies (99.4
per- cent) from across the country report that their officers wear body armor
when on duty." \- BJA/PERF Body Armor National Survey - page 36

~~~
DanBC
Ignoring the word "SWAT" for the moment this was a raid on corporate offices
for people smuggling honey.

I'm not sure why officers were armed. I guess I can understand why they wear
protective clothing (but are shootings in that situation common?)

Are honey smugglers really going to shoot law enforcement?

You need lots of people in the raid to prevent employees shredding and
deleting everything.

~~~
a3n
> I'm not sure why officers were armed.

My assumption is that any officer who is armed at the moment is always armed,
and any officer who is always armed will be armed when he visits you. In other
words, being armed in this instance may not be particularly interesting. Now,
if they had their arms drawn at the ready, that might be more than
interesting.

~~~
NickNameNick
Police in NZ are not routinely armed, at least, not with anything more than
some pepper spray and a batton.

I am aware that this is not the case in many other parts of the world, but I
still pay attention to the difference between 'normal' and armed police.

~~~
hrkristian
It's the same in Norway, not sure about the other Scandinavian countries. Of
course, our distinction between 'normal' and 'armed' police has no bearing in
the US where the environment is completely different and armed civilians is
almost an everyday occurrence.

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iamshs
So only punishment for the fraud (of masking the country of origin,
adulterating honey with banned antibiotics, rice molasses and such) was one
year of jail for two executives, who were declared rogue by the company after
their arrest. How will you deter future frauds then?

~~~
gcb1
this part reminded me of breaking bad.

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mprovost
I always thought this was the largest food fraud, it almost brought down
American Express. And they weren't forging the origin of the product but
actually replacing it with water!

[http://en.wikipedia.org/wiki/Salad_Oil_Scandal](http://en.wikipedia.org/wiki/Salad_Oil_Scandal)

------
davvid
I get a broken link on my mobile device. This link seems to work, though:

[http://mobile.businessweek.com/articles/2013-09-19/how-
germa...](http://mobile.businessweek.com/articles/2013-09-19/how-germany-s-
alw-got-busted-for-the-largest-food-fraud-in-u-dot-s-dot-history)

------
jlmorton
"After U.S. beekeepers accused Chinese companies of selling their honey at
artificially low prices, the government imposed import duties in 2001 that as
much as tripled the price of Chinese honey. Since then, little enters from
China legally."

If Chinese companies were truly selling their honey at artificially low prices
-- that is, dumping the honey below cost, in an attempt to destroy the
competition -- then this entire scheme would not make sense. Why sell some
small amount of honey at below-cost prices as part of an illicit scheme
bypassing tariffs?

What this truly proves is that U.S. tariffs against Chinese honey producers
are not actually based on "artificially" low prices. It's just pure
protectionism for an industry group, at the expense of consumers.

~~~
Steuard
You seem to have missed the bits about Chinese honey being commonly collected
and processed in non-standard ways (machine dried, it said) that lead to
inferior taste, which was then covered up with various additives. Also the
bits about Chinese honey often containing residues of antibiotics that are
banned in US food.

So I read "artificially low prices" not as "dumping below cost" but rather
"cutting costs by ignoring legally required quality controls".

~~~
malandrew
China has notoriously poor food standards and regulations, and only enforces
them when they need to have some heads roll because the public is outraged.
Business culture in mainland China is also strongly a "caveat emptor" market,
so every buyer is left to their own devices to perform due diligence when
purchasing something. In the US, regular inspections and regulations keep
things mostly orthodox, and while irregularities happen in US food
manufacturer, they are far and few between relative to China.

With that in mind, what would be reasonable if providing an exception to the
tariff, if, and only if, the Chinese honey manufacturer can demonstrate
provably that their honey and manufacturing meet high standards. This should
apply everywhere. If these manufacturers were employing better manufacturing
methods, their honey prices would probably be more inline with US prices.

------
coldcode
Always buy local honey from real beekeepers. Otherwise you are probably buying
sugar water made by non worker bees.

~~~
rdtsc
Doesn't that open a market for local "beekeepers" to buy honey from China and
package it up with inkjet printed labels and hand screwed lids that say "local
from <insert town>"? Placebo and power of suggestion is strong. I often wonder
myself if produce I am buying at farmers markets a really authentic or just
resold produce from grown on a large agro-business farm someplace across the
country.

Also, I am a ware of a scheme that is importing Chinese garlic into Western
Europe through Eastern Europe. You see Chinese garlic much like honey is
banned there. Yet unbeknownst to them West Europeans (Germans, French) have
been chowing down on Chinese garlic for a while now. The way it works it like
this. A large shipment is brought into a city next to the EU border. Then
small paid cargo van drivers make lots of trips across the border seemingly as
local farmers going about their business. Then it is either sold at farmers
market or "local" farmers buy it from them and sell it as "local" produce.
Easy peasy.

~~~
einhverfr
Bees can be raised, with a few precautions, even in urban settings. What you
really need is an experienced mentor who can help consider things like where
to place the hive so it doesn't pose a problem for neighborhood kids (rooftop
is good btw), and other precautions, such as not wearing gloves when handling
the bees if in an urban environment.

~~~
drue
I am an amateur beekeeper but I do not understand how wearing gloves is
related to raising bees in an urban environment.

You are right, that urban bees are fine. Providing a water source will prevent
most nuisance issues.

~~~
einhverfr
The argument is that if you wear gloves you miss out on the early signs of
alarm from the bees, and therefore they are more likely to swarm and get
aggressive towards bystandards. Without gloves you get a better sense of the
alarm state and can avoid problems. It's generally easier to manage alarm
state without gloves.

I got my first hive a few years ago, and I am noticing that there are fewer
recommendations of working without gloves in urban environments today. I don't
know why this is the case. Also I am used to a large yard/small town
environment (lots of pedestrians, folks doing yard work, etc), and there are
plenty of other environments where I would expect this to be less of an issue
(for example a rooftop hive on the third storey is going to provide a lot less
exposure in this regard). So demographics and hive placement may have
something to do with it.

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nraynaud
I like the idea that foreigners got a harsher sentence than the Texans in a
case involving exceptionnally big tariffs against a chineese product, it
reinforces my prejudice that Americans are xenophobes.

~~~
eshvk
Do you have any evidence to suggest that the crimes that both the citizens and
the non-citizens were charged with were different and yet one group got a
lesser sentence?

~~~
nraynaud
These are not non-citizens, these are citizens from another country. I'm a bit
tired of US people using this vocable too.

~~~
rjbwork
While I agree with the sentiment, as an American, it becomes a bit difficult
to not let the verbiage of the media and power seep into your vernacular.

~~~
nraynaud
Orwell agrees. "foreigner" or "alien" convey the exact meaning you are looking
for without implying the person comes from a barbaric non-democratic country
(ironically on the day they elect their deputies, and transitively, their
leader).

------
danso
Last year I visited Germany for the first time and was astounded at how good
their English was, despite it being so far from French/Spanish/Italian (which
I'm a little familiar with)...everywhere I went, people were happy to speak to
me in English, almost in a slightly condescending way, like "poor American,
let me speak your language for you" (and the condescension is well-deserved,
IMO).

But wow, the German executives at hand must think Americans are _really_ anti-
multi-lingualism if "WRITE IT IN GERMAN" is one of their protocols for
obfuscating their fraud.

~~~
Locke1689
You're aware English is primarily a Germanic language, right?

~~~
TillE
Not particularly relevant, partly because English has been corrupted by all
sorts of influences. There's some common vocabulary, but the syntax and sound
are very very different.

Look at it from the other perspective: German is commonly (and IMO properly)
considered a bit harder for anglophones to learn as compared to Spanish or
Italian. The linguistic family is only a small piece of information, and
doesn't tell the whole story.

~~~
asveikau
As far as I know the fact that "the sound is different" from most European
languages is not really due to any "corruption" (like the Norman Conquest) but
due to this:
[http://en.wikipedia.org/wiki/Great_Vowel_Shift](http://en.wikipedia.org/wiki/Great_Vowel_Shift)

Quoting from the Wikipedia article linked above:

> Vowels of Middle English had "continental" values much like those remaining
> in Spanish and liturgical Latin. However, during the Great Vowel Shift, the
> two highest long vowels became diphthongs, and the other five underwent an
> increase in tongue height.

As for syntax I've always heard and read that it sounds very natural to
speakers of Germanic languages.

------
adamnemecek
I wonder whether they were arrested in a _sting_ operation.

~~~
ekimekim
Would you say the feds set up a _honeypot_?

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nickfox
I'm not too much of a conspiracy theorist but I wonder if the Chinese are
behind Colony Collapse Disorder that is devastating our bee populations...
They destroy our bees and we are therefore beholden to them in yet another
critical piece of infrastructure. I guess the best way to determine that is to
figure out if CCD is destroying bee populations in China at the same rate as
in the U.S. and Europe.

Far-fetched? Cut back on the weed? Stop reading Hacker News and get back to
work?

~~~
krapp
No, the bees just went back to their home planet. I'm sure it's nothing to
worry about.

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twelve40
Paint some bees on the containers, replace ALW with Madrigal GmbH, Hamburg
with Hannover, and you get another eposide of...

------
malandrew
I was shocked at the fines involved. $180 million in tariffs avoided, but from
what I read, only $3 million in fines were meted out.

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gcb1
the take away in this history is that if they sold honey at regular prices at
the honey holdings "over the table" while still giving the deal to the buyer
and eating the fiscal difference for the fake vs received price, they would
still be operating.

