The firm is accused of illegally importing Chinese honey. Some honey was seized in Minnesota.
A federal grand jury in Chicago has indicted a German food conglomerate and 12 executives on charges of illegally importing $40 million in falsely labeled Chinese honey -- some of it tainted with antibiotics -- and selling it in Illinois, Minnesota and other states.
Alfred L. Wolff GmbH, whose U.S. honey-importing unit is based in Chicago, was charged in a 44-count indictment issued Tuesday along with 10 of its top executives and two other businessmen. The indictment described a six-year conspiracy to import Chinese honey in violation of anti-dumping laws, falsely declaring that it came from other countries, including Russia and India.
The practice, known as "honey laundering," has been widely denounced by U.S. honey producers, most recently at a honey trade group's booth at the Minnesota State Fair this week.
Federal investigators seized more than 2,400 55-gallon drums of illegally imported Chinese honey in Illinois, Minnesota and Washington state in 2008, according to the indictment.
It said samples from 38 shipments contained traces of two antibiotics not approved for food products. Alfred L. Wolff subsidiaries marketed the tainted honey to customers who didn't bother to test for antibiotics, including an unidentified Texas firm that executives referred to as the "Garbage Can," the indictment said.
While showing little concern about the antibiotics, executives selling the honey sometimes used "triple filtration" to remove pollen and trace elements that could link the honey to China, the indictment said.
The U.S. Food and Drug Administration, which cooperated with law enforcement agencies in the investigation, said the low levels of antibiotics in the Chinese honey are not likely to cause adverse reactions in people, and no illnesses linked to adulteration have been reported.
"Consumers shouldn't be afraid that the honey in their cabinets is dangerous," said Siobhan DeLancey of the FDA's Center for Food Safety & Applied Nutrition. However, anyone who suspects honey is making them ill should contact their doctor, she added.
Much of the honey sold in the United States is imported. In 2001, the federal government declared that China was dumping its honey in the United States at unfair prices. An anti-dumping duty was imposed, dramatically increasing the price on imported Chinese honey.
U.S. Attorney Patrick Fitzgerald in Chicago said Alfred L. Wolff's honey-laundering operation "aggressively sought and obtained an illegal competitive advantage in the U.S. honey market" and avoided paying nearly $80 million in duties from 2002 to 2009.
The company and its executives could not be reached for comment.
It is unclear where all the illegal and tainted honey ended up. The indictment hints that some was destined for home cupboards. In one deal, a Chinese supplier promised "5,000 honey bear jars at a cost of $1.50 per jar," the indictment said.
Honey industry officials say much of the illegal Chinese honey probably was sold to large food companies as an ingredient in other food products.
"Most of it does end up in the bulk honey market," said Steve Ellis, secretary of the National Honey Bee Advisory Board. He noted that jars of honey, unlike other honey-containing products, must state on the label where the honey was produced.
Eight customers who purchased the laundered honey are mentioned in the indictment, but they are not identified by name and, except for the Texas customer, their locations are not stated.
So far, none of these customers has been charged, and it is unclear whether they were duped buyers or willing participants. The investigation is continuing, however.
The charges pleased leaders of Minnesota's honey industry, who on Monday teamed up with U.S. Sen. Amy Klobuchar, D-Minn., at the State Fair to denounce Chinese honey laundering. Klobuchar estimated the illegal trade has cost the U.S. Treasury up to $200 million a year in revenue.
"It is just the tip of the iceberg," said David Ellingson, who owns a honey production company in Odessa, Minn., and is former president of the Minnesota Honey Producers Association. "We know there is a lot of honey out there that is coming in through different venues that are not legal. I am just glad there is some action."
David Shaffer • 612-673-7090