According to the Strengthening Organic Enforcement (SOE) regulation update §205.201(a)(3), all organic operations are now required to establish monitoring practices and procedures to prevent fraud in the organic industry (these procedures are often referred to as Fraud Prevention Plans or “FPPs”). The NOP states Fraud Prevention Plans are required for every operation, and they must be tailored to be appropriate for each operation. For example, “a producer who does not handle another operation’s organic products may develop a simple fraud prevention plan that verifies purchased inputs comply with organic regulations.” All entities are also asked to have awareness of how to report fraud to the NOP.
As a result, OneCert has added three new questions to the Organic System Plans (OSP’s) for Crops, Wild-Crops & Livestock. To help you complete the OSP updates and better understand the new questions, we have developed some guidance for each question:
OSP Question: If applicable, describe how you verify your organic suppliers (e.g. animals, livestock feed, seed/seedlings) are certified. Include the frequency you check supplier certificates/OID and how you document the process:
GUIDANCE:
- This question must be answered if you currently use, plan to use, or may potentially use organic seed, seedlings/planting stock, or any other certified organic inputs.
- This question must be answered if you buy organic animals or livestock feed.
- This question may only be marked “N/A”if you never use or purchase organic seeds/planting stock, animals, livestock feed, or any other certified organic inputs.
- Describe how you verify Suppliers are certified. Do you obtain a copy of each organic certificate? Do you use the Organic Integrity Database (OID)?
- Describe the frequency suppliers are verified. Do you check the certificate prior to each organic purchase? Do you review all suppliers once a year?
EXAMPLE ANSWER: With the first purchase of the year from each vendor I obtain a copy of the current organic certificate. The certificate is checked to make sure they are certified for the item I am buying. Then, with each additional purchase from that supplier, I check the OID to make sure they are still certified.
OSP Question: Describe how you have evaluated opportunities for fraud in your supply chain (for both incoming and outgoing organic product):
GUIDANCE:
- Think like a criminal!
- Do a self assessment: Ask yourself where fraud is most likely to occur or where mistakes are most likely to happen within your operation. Describe these risks in your response.
- Evaluate your suppliers and buyers: Ask yourself where fraud or mistakes are most likely to happen within those operations. Describe these risks in your response.
- Some common risk factors are:
- Inputs (Seeds/Feed/Pest & Fertility Materials, etc.) – Risk of using a prohibited input, receiving a misbranded product, scarcity or market demand of product
- Suppliers – Supplier relationships, certificate verification steps, complexity of supply chain, reports of fraud/corruption, imports, uncertified suppliers
- Transportation/Packaging – Risk of substitution during transportation of bulk/unsealed packaging
- Livestock Traceability – Risk of receiving a tagless animal, ability to link to certified supplier & to verify they were under continuous organic management during transport, ability to verify animal eligibility for organic slaughter
- Financial Health – Back-up plans for total crop failure, dealing with contracts
- Most producers do not have a formal “Vulnerability Assessment” like large scale processors, but if you do, these existing assessments may be simply referred to and attached. (e.g. You may have this if you are also certified to a Food Fraud or Food Safety program.)
EXAMPLE ANSWER: I did a self assessment and determined the greatest risk in my operation is seeds, seed coatings and inputs. The greatest areas of risk in my supply chain are my seed suppliers selling both organic and non-organic seeds, so there is a risk that I may receive the wrong seeds. The risk associated with my buyer is fairly small because I only work with one buyer that is local and well known to me. I am not aware of any prior fraudulent activity in my supply chain.
OSP Question: What measure have you taken to address those risks:
GUIDANCE:
- Describe how you are addressing the risks you identified in the previous step.
- Include any additional monitoring you will do.
- Include how you will report any evidence of fraud to the NOP and/or OneCert.
EXAMPLE ANSWER: Upon delivery, I check that the labels on all inputs and seeds match what I ordered (e.g. what is on the invoice). I keep copies of these for my records and check that inputs (including seed coatings!) are approved by OneCert and on my Inputs List before using them. I maintain a close relationship with my buyer and I monitor market trends in my area. I will report any suspicious activity or evidence of fraud to OneCert, or if appropriate, directly to the NOP using their online form for complaints.
How strictly will OneCert evaluate compliance to these new Fraud Prevention requirements?
This year, our priority is to help all clients make a meaningful start. This means we want to see that you have made an attempt to answer the new OSP questions. OneCert will communicate with you at each step of your certification cycle to help avoid potential compliance issues:
- At Initial Review, we will communicate with you if these OSP questions are incomplete and encourage you to make updates using our above guidance.
- Inspectors are being trained to discuss the new questions with you when they are conducting inspections. They will identify and collect updates to the OSP where appropriate.
- After inspection, we will only issue Minor Issues or Notices of Noncompliance if the new OSP questions have not been completed. We may provide reminders for future improvements.
- 2025 and beyond: We expect fraud prevention plans will be an area for continuous improvement for the next couple of years. OneCert will communicate during renewal if there are additional updates or risks that should be addressed in your OSP.