California Takes a Bite Out of Farmers Market Fraud
Brie Mazurek, CUESA Staff
October 10, 2014
Most people take it for granted that all the fruits and vegetables at the farmers market are grown by the farmers who are selling them. And with good reason: the purpose of farmers markets is to foster direct relationships between producers and consumers. Values like knowing your farmer, transparency, and nurturing the local foodshed are at the core of why people shop at farmers markets.
But recent reports of fraud threaten to undermine that foundation of trust. In 2010, an undercover investigation revealed farmers purchasing wholesale produce from Mexico to sell at Los Angeles farmers markets. Last year, LA County boosted enforcement at markets and rooted out 19 vendors selling produce they didn’t grow.
“The most important thing that farmers markets have is their reputation as a place where customers can buy fresh produce directly from the producer,” says farmer Dan Lehrer of Flatland Flower Farm, who sells his certified organic apples and plant starts at the Ferry Plaza Farmers Market. “If the perception of the public is that you have no idea what you’re actually getting, then the farmers market movement is dead in the water.”
A new California law (AB 1871) recently signed by Governor Jerry Brown takes aim at vendors who are cheating the system. As reported by David Karp at the Los Angeles Times, some of the key points of the legislation include:
Fees that certified markets pay to the state for each vendor will be raised from $.60 to $2 per day to increase funding for enforcement. The fee increase is projected to raise $1 million in new revenue to be used by the California Department of Food and Agriculture (CDFA) to hire farmers market inspectors and reimburse county agriculture departments for farm inspections and for their investigations of suspected cheaters. The fee has also been expanded to include all market sellers, including prepared food vendors, whereas only farmers were previously subject to the fee.
Growers will be required to display signage that says their name, county of production, and a statement to the effect of “We grow what we sell.” False or misleading claims about a producer’s identity, growing region, or methods of production are a misdemeanor punishable by fines of up to $2,500 or imprisonment.
The reselling of fruit, vegetables, and flowers by vendors who did not grow them themselves will no longer be allowed in the ancillary, non-certified areas adjacent to certified farmers markets. (This was never a practice at the Ferry Plaza, where the ancillary sections are exclusively for local food crafters and restaurants, but some markets allow vendors in these ancillary sections to resell imported produce).
While working at farmers markets, Lehrer has encountered his share of suspicious-looking products at neighboring stalls. One grower sold fresh walnuts week after week off season; another one sold perfectly uniform carnivorous plants. Though obvious to a farmer, such warning signs may not be easy to spot by the average shopper. “I would not expect most customers to be able to look at something and tell if it’s grown by the farmer or not,” says Lehrer.
Particularly at smaller and newer markets where variety is scarce, vendors might be tempted to augment their booths with products they didn’t grow, by purchasing from wholesale produce markets or nearby farms. At more mature markets, where competition for stall space is high, there’s generally greater scrutiny from other vendors, which makes cheating a riskier proposition.
A member of the California Certified Farmers Market program, CUESA’s Ferry Plaza Farmers Market has clear guidelines stating that growers can only sell agricultural products they have grown themselves. In rare cases, a producer may be given approval to sell a unique product grown by a neighboring farm under what is known as a “second certificate,” as long as the origin is clearly identified.
However, without the support of state and county agriculture officials, market rules can be difficult to enforce. “I think fraud is a concern in every market,” says Director of Operations Dexter Carmichael. “We do our own inspections, and we can set higher criteria for entrance and for staying in the market, but unless the state or a third party is there to back us up, it can be hard to take action if we think someone is cheating.”
He sees the new legislation as giving teeth to direct marketing regulations, so that there’s a process for the state to track and follow up with complaints. “If we have a question about a seller, it gives us the backing of the state and clear lines of enforcement,” says Carmichael. “It’s the institutionalizing of the farmers market system in a positive way.”
Dan Best, general counsel to the California Federation of Certified Farmers Markets, was part of an ad hoc committee tasked with making recommendations to the state following the exposés in Los Angeles. Their findings became the basis of AB 1871. “We wanted to help create a system that was more efficient in its methods, not just throw money at it,” he says.
To step up enforcement, the CDFA originally requested raising fees to $4 per vendor per market, but Best and his colleagues knew that raising fees would be a sensitive point for farmers who operate on slim profit margins, and they fought to keep the fee at $2. “We were always in the wings trying to make sure the interests of the farmers were represented,” says Best.
But making sure those fees get put to good use, of course, still remains to be seen. “How 1871 gets implemented is critical,” says Ben Feldman, the chair of the California Alliance of Farmers Markets.
He noted a recent CDFA pilot project involving four counties that provides a blueprint for how county and state officials might coordinate with each other to identify red flags, share data, and improve communication. To ensure quick and effective response to suspected deceptive practices, farm inspections took place within 48 hours of a market inspection. “We now have a model to look to, in terms of CDFA and counties working well together and actually doing the type of enforcement that will identify fraud that’s happening.”
While the new legislation could never replace the understanding that comes from shoppers knowing and talking to their farmers, it is intended to deepen consumer confidence and provide a useful tool for market managers to protect the integrity of our modern farmers market program, enacted by Governor Jerry Brown in 1977.
“Regardless of how widespread it is, fraud is a significant issue,” says Feldman. “Individuals committing fraud are trading on the good name of honest, hardworking farmers. They are taking advantage of a system that relies on the trust of the consumers who are buying from them.”
Lehrer concurs. “If there are going to be cheaters that destroy that integrity, there’s got to be enforcement. It’s the same in any industry. You need somebody to shine a little sunlight to make sure everyone’s on the up and up.”
Want to learn more? Check these tips for avoiding farmers market cheaters.