Italian Police Official Explains How Olive Oil Fraud Works

Fraud and coun­ter­feit­ing oper­a­tions con­tinue to pose sig­nif­i­cant chal­lenges for the olive oil indus­try.

In Italy, one of the world’s largest olive oil pro­duc­ers, spe­cial­ized police units are actively com­bat­ing the illicit food trade, explic­itly focus­ing on olive oil adul­ter­ation.

Genuine, high-qual­ity olive oil is a prime tar­get for crim­i­nal orga­ni­za­tions. Counterfeit olive oil, falsely labeled as a PDO (Protected Designation of Origin) or PGI (Protected Geographical Indication), under­mines legit­i­mate pro­duc­ers and poses seri­ous risks to con­sumer health.

For crim­i­nals, coun­ter­feit high-qual­ity food can yield sub­stan­tial prof­its. This trend is preva­lent across many sta­ples of Italian cui­sine, with olive oil being a par­tic­u­larly lucra­tive tar­get.

The Central Inspectorate for the Protection of Quality and Fraud Repression of Agri-food Products (ICQRF), an agency under the Ministry of Agricultural and Forestry Policies, reported that in 2023 alone, 380 tons of ille­gal olive oil prod­ucts, with a value exceed­ing €2 mil­lion, were seized.

“Extra vir­gin olive oil, along with PDOs and PGIs, are pre­mium prod­ucts that con­tinue to grow in vol­ume and mar­ket share,” Lieutenant Colonel Michele Avagnale, com­man­der of the Carabinieri Health Protection Group (NAS) in Naples, a spe­cial­ized unit within the Italian police forces, told Olive Oil Times.

“Italy’s olive oil indus­try involves numer­ous key play­ers, from pro­duc­ers and olive mills to both pri­mary and sec­ondary pro­cess­ing indus­tries, as well as com­pa­nies that pur­chase Italian and for­eign olive oil to cre­ate blends or bot­tle and sell it to the final dis­tri­b­u­tion com­pa­nies,” Avagnale explained.

“Similar types and grades of olive oil can be legally blended,” he added. ​“European Union leg­is­la­tion stip­u­lates that a legit­i­mate extra vir­gin olive oil blend con­sists solely of extra vir­gin olive oils that belong to the same com­mer­cial cat­e­gory and fully com­ply with extra vir­gin olive oil reg­u­la­tions.”

This is where ille­gal blend­ing comes into play, under­min­ing the mar­ket and pos­ing poten­tial threats to con­sumer health.

“When we talk about food fraud, I would speak about tan­gi­ble dam­ages rather than risk fac­tors,” Avagnale said. ​“Food fraud is a seri­ous threat to pub­lic health. Criminals seek to deceive con­sumers by sell­ing prod­ucts that do not match what is stated on the label.”

Avagnale warned that food fraud inflicts dam­age in mul­ti­ple ways, result­ing in eco­nomic losses for con­sumers, busi­nesses and the state.

“Public health may also be dam­aged since food con­tain­ing harm­ful sub­stances or those which alter the nutri­tional bal­ance may be mar­keted,” he said. ​“Illegal blend­ing involves mix­ing vir­gin or extra vir­gin olive oils with lower-qual­ity oils, known as ​‘lam­pante.’ These oils are then treated to remove any organolep­tic or chem­i­cal defects.”

Advanced blend­ing tech­nolo­gies are also exploited to per­pe­trate olive oil fraud.

“Illegal blend­ing can also involve link­ing con­tain­ers of sub­stan­dard prod­ucts to those con­tain­ing qual­ity oil, blend­ing them through spe­cial­ized soft­ware,” Avagnale said. ​“Using this soft­ware, crim­i­nals can pro­duce a prod­uct whose organolep­tic and chem­i­cal para­me­ters meet the E.U. reg­u­la­tions for extra vir­gin olive oils.”

The acces­si­bil­ity of the tech­nol­ogy has enabled crim­i­nal orga­ni­za­tions to refine their oper­a­tions, exploit­ing the pop­u­lar­ity of olive oil for profit. Consequently, NAS has also had to enhance its tech­nol­ogy and meth­ods.

“Agri-food crime has evolved over the years,” Avagnale said. ​“It no longer involves crude, eas­ily detectable coun­ter­feits through ran­dom sam­pling, such as the par­tial or com­plete blend­ing of extra vir­gin olive oil with soy­bean, sun­flower or palm oils mixed with chloro­phyll or beta-carotene.”

“Today, these crimes involve far more sophis­ti­cated frauds, mak­ing them dif­fi­cult to detect with stan­dard sci­en­tific analy­ses,” he added. ​“We often need to rely on genetic or other exper­i­men­tal analy­ses. In some cases, every indi­vid­ual batch of olive oil should be checked before blend­ing.”

“Moreover, pack­ag­ing and label­ing meth­ods have also advanced,” Avagnale explained. ​“The use of high-qual­ity mate­ri­als and imag­i­na­tive names makes it even more chal­leng­ing to iden­tify non-com­pli­ant prod­ucts.”

NAS inves­ti­ga­tions may involve envi­ron­men­tal and phone sur­veil­lance, inspec­tions, con­trols, com­par­isons and exten­sive paper and elec­tronic doc­u­men­ta­tion analy­sis.

“Additionally, com­pa­nies often oper­ate through net­works of shell com­pa­nies and use sys­tems of false invoic­ing, com­pli­cat­ing the recon­struc­tion of com­mer­cial trans­ac­tions,” Avagnale said. ​“These com­pa­nies are typ­i­cally linked to front­men.”

“In the end, inves­tiga­tive activ­i­ties often require the par­tic­i­pa­tion of inter­na­tional orga­ni­za­tions and spe­cific legal sup­port,” he added. ​“During many inves­ti­ga­tions, it turned out that some prod­ucts are pur­chased in one coun­try, processed in another and sold else­where, mak­ing con­trols more dif­fi­cult.”

Over 1,000 NAS agents are deployed across Italy, form­ing part of a broader food and phar­ma­ceu­ti­cal safety net­work oper­at­ing through­out the E.U.

Italian law enforce­men­t’s coor­di­na­tion with national and inter­na­tional agen­cies allowed for some of the most sig­nif­i­cant anti-coun­ter­feit­ing and anti-fraud oper­a­tions con­ducted in more than one olive oil-pro­duc­ing coun­try.

The most recent large-scale oper­a­tion involved dis­cov­er­ing more than 71 mil­lion tons of illicit oily sub­stances in the south­ern Italian region of Puglia.

“With olive oil, NAS inves­ti­ga­tions often begin with on-the-spot checks, fre­quently ini­ti­ated by reports from con­sumers or asso­ci­a­tions,” Avagnale said.

NAS ver­i­fies com­pli­ance with reg­u­la­tions through sam­pling and exten­sive lab­o­ra­tory analy­sis.

“When a non-com­pli­ant prod­uct is iden­ti­fied, safe­guard pro­ce­dures are imme­di­ately imple­mented,” Avagnale said. ​“These mea­sures include sus­pend­ing the busi­ness license, with­draw­ing the spe­cific prod­uct and con­duct­ing fur­ther ver­i­fi­ca­tion activ­i­ties related to the pro­duc­tion chain, trace­abil­ity and com­mer­cial dis­tri­b­u­tion.”

To help com­bat the inter­na­tional nature of food and olive oil fraud, E.U.-wide alert sys­tems, such as RASFF (Rapid Alert System for Food and Feed), are inte­grated into NAS activ­i­ties.

“Established in the late 1970s, this tool has evolved to include mate­ri­als and objects intended to come into con­tact with food, as well as pet food,” Avagnale said. ​“The sys­tem is acces­si­ble online, allow­ing all par­tic­i­pants to share, acti­vate and notify rel­e­vant infor­ma­tion in real-time.”

Avagnale empha­sized that con­sumers can play a cru­cial role in reduc­ing and com­bat­ing food fraud, par­tic­u­larly in the olive oil sec­tor, list­ing some sim­ple rec­om­men­da­tions con­sumers may fol­low:

• Purchase prod­ucts from trusted stores and mar­kets, not from impro­vised ven­dors;
• Learn how to rec­og­nize raw mate­ri­als, their ori­gins and their his­tory;
• Read prod­uct labels care­fully before pur­chas­ing to under­stand the exact com­po­si­tion of the food (ingre­di­ents, addi­tives, preser­v­a­tives), stor­age meth­ods, expi­ra­tion date, pro­duc­er’s name, pro­duc­tion batch, and the ori­gin of raw mate­ri­als;
• Give pref­er­ence to sea­sonal foods with a ​“short sup­ply chain” or ​“zero kilo­me­ters,” and opt for healthy, prefer­ably home-cooked, meals;
• Be wary of over-processed food with numer­ous ingre­di­ents and unclear or barely read­able labels;
• Learn to rec­og­nize the dis­tinct char­ac­ter­is­tics of foods;
• Exercise cau­tion with low prices.

“A very low price for prod­ucts like extra vir­gin olive oil is often a sign of low-qual­ity oil, likely imported or blended with seed oil,” Avagnale said, pro­vid­ing a spe­cific exam­ple of a NAS inves­ti­ga­tion into olive oil fraud.

“It resulted in the judi­cial recog­ni­tion of crim­i­nal respon­si­bil­ity for all involved, lead­ing to var­i­ous prison sen­tences and addi­tional penal­ties, includ­ing trad­ing pro­hi­bi­tions,” he said.

The inves­ti­ga­tion began with a doc­u­ment search that uncov­ered hand­writ­ten note­books and fold­ers con­tain­ing off-the-books records hid­den inside a trap­door.

“The com­pany under inves­ti­ga­tion oper­ated with a pyra­mi­dal struc­ture: the chair­man of the board of direc­tors, who led the orga­ni­za­tion, man­aged intra-com­mu­nity oil trades, directed employ­ees in assem­bling each batch, and super­vised the chem­i­cal lab­o­ra­to­ry’s work,” Avagnale said.

“Next in line was the admin­is­tra­tive direc­tor, who acted in place of the chair­man dur­ing his absence and man­aged rela­tion­ships with the banks,” he added. ​“As for the employ­ees, one man­aged the place­ment of bulk prod­ucts in the mar­ket, while another served as the sales rep­re­sen­ta­tive.”

Meanwhile, Avagnale said another employee han­dled the prod­ucts’ con­sti­tu­tion, assem­bly and fil­tra­tion, which were then stored in the company’s ware­house.

“He was often respon­si­ble for blend­ing the prod­uct, strictly fol­low­ing the chair­man’s direc­tives,” Avagnale added. ​“Additionally, the com­pany employed an admin­is­tra­tive worker respon­si­ble for updat­ing the National Agricultural Information Service (SIAN).”

SIAN is a manda­tory elec­tronic reg­is­ter where com­pa­nies must record every entry, with­drawal, and blend­ing of vir­gin and extra vir­gin olive oil. ​“It is part of an exten­sive con­trol sys­tem over­seen by exter­nal enti­ties like the ICQRF,” Avagnale said.

“The chair­man, the direc­tor and the employee respon­si­ble for main­tain­ing the SIAN reg­is­ter were charged with com­plic­ity in fal­si­fy­ing records and noti­fi­ca­tions under Article 484 of the Italian Penal Code,” he added. ​“They had entered false data into the sys­tem regard­ing the pur­chase, move­ment, and pro­cess­ing of the oil batches stored in the com­pany, intend­ing to mar­ket vir­gin and extra vir­gin olive oil.”

“The com­par­i­son between account­ing and non-account­ing doc­u­men­ta­tion, the results from the SIAN elec­tronic reg­is­ter, and sur­veil­lance activ­i­ties revealed dis­crep­an­cies between what was offi­cially recorded and what was sold, indi­cat­ing efforts by the com­pany to con­ceal fraud from the con­trol author­i­ties,” Avagnale explained.

The alleged fraud was cat­e­go­rized into com­mer­cial fraud, related to the pro­duc­t’s organolep­tic char­ac­ter­is­tics, and fraud con­cern­ing geo­graph­i­cal ori­gin, which involved ille­gal blend­ing.

“In the inves­ti­ga­tions con­cern­ing fraud related to the pro­duc­t’s organolep­tic char­ac­ter­is­tics, inves­ti­ga­tors uti­lized envi­ron­men­tal and wire sur­veil­lance in addi­tion to ana­lyz­ing account­ing and non-account­ing records,” Avagnale said.

“What enabled inves­ti­ga­tors to obtain a detailed and accu­rate under­stand­ing of events were the note­books, man­u­scripts and fold­ers labeled ​‘inter­nal cuts’ and other sim­i­lar records,” he added. ​“The ille­gal activ­ity involved the national and inter­na­tional whole­sale of large batches of olive oil.”

Avagnale said the doc­u­ments detailed how the com­pany imported lam­pante olive oil from Spain and Italy in bulk before blend­ing them, bot­tling and label­ing the prod­uct as extra vir­gin olive oil.

“This was sup­ported by chem­i­cal-phys­i­cal and organolep­tic con­trols con­ducted by the inter­nal lab­o­ra­tory,” Avagnale explained. ​“These mate­ri­als were irreg­u­lar, con­sist­ing of prod­ucts with very high lev­els of per­ox­ide and acid­ity.”.

“Furthermore, large quan­ti­ties of olive oil dif­fered in ori­gin and qual­ity due to using raw mate­ri­als of vary­ing nature and ori­gin,” he added. ​“Nevertheless, they were sold to buy­ers and labeled as extra vir­gin olive oil or 100 per­cent Italian extra vir­gin olive oil, lead­ing to charges under Articles 515 and 517-bis of the Italian Penal Code for com­mer­cial fraud, aggra­vated by the mis­use of the ori­gin pro­tec­tion mark.”