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Healthcare Product Fraud

Healthcare and Food Product Fraud

Today’s marketplace offers a wide range of healthcare options, both in preventing and treating injuries and illness. While advances in technology have revolutionized many treatments, unscrupulous individuals, once known as “snake oil salesmen,” have also found countless opportunities to exploit consumers’ lack of medical knowledge. Healthcare product fraud is a serious problem, according to the U.S. Food and Drug Administration (FDA), which estimates that consumers spend at least $2 billion per year on unproven arthritis treatments alone. The FDA lacks the resources, it says, to pursue most types of fraud, and therefore focuses its efforts on fraudulent healthcare products that pose a serious risk to the public. Our experienced Chicago healthcare product fraud lawyers can assist people who have suffered injury from an alleged fraud, deception, or unfair practice in the sale, servicing and furnishing of healthcare goods and products by investigating the fraud and pursuing a claim for damages.

Types of Healthcare Product Fraud

The FDA defines healthcare product fraud, or “healthcare fraud scams,” as marketing that claims certain products can assist in treating or even curing diseases or other health issues, when in fact those products have no such scientifically-accepted beneficial effect. This type of fraud wastes consumers’ money, and can threaten consumers’ well-being by delaying or even preventing proper diagnosis.

Healthcare product fraud may also refer to misleading or false statements regarding the ingredients or potency of a medication or dietary supplement. This could include medications that are missing an active ingredient, or that have a substantially lower, or higher, amount of an active ingredient than shown on the label. Products such as these could prolong or worsen an illness by not containing enough of an active ingredient to have the desired effect, or they could cause a harmful overdose if the active ingredient is present in a higher concentration.

Healthcare Products Susceptible to Fraud

Products that claim to treat chronic or terminal conditions, such as arthritis, cancer, or HIV, are particularly susceptible to fraudulent claims. Other types of healthcare products that seem to attract scammers include weight-loss products, products that claim to remove signs of aging, products that claim to help users quit smoking, and products that treat cosmetic conditions like acne. Please note that the mere fact that a broad category of healthcare product is prone to fraud is not to say that any particular product is itself fraudulent.

False Labeling on Food Products

Healthcare products are not the only type of product susceptible to fraudulent claims. Food products often claim health benefits – such as curing or preventing health problems – that are at best unsupported by scientific evidence and are at worst patently false. Claiming that a food is “organic,” “natural,” or “contains no genetically modified ingredients” when the food product does not actually meet the legal requirements of carrying such labels constitutes false labeling. The following are some examples of false labeling on food products to beware of:

  • “Organic”: Companies also sometimes describe a food product as organic despite failing to meet the requirements for such labels. The U.S. Department of Agriculture’s Agricultural Marketing Service has promulgated rules for the labeling of foods of organic, but the bottom line is that a food product must be certified as organic by USDA-authorized certifying agent to carry the label of “organic.”
  • “Natural”: A product labeled as “natural” must not contain synthetic or artificial ingredients, but it may still contain pesticides, genetically modified ingredients, or high fructose corn syrup.
  • “Gluten-Free”: A food product may claim to be gluten-free on its label if it contains no wheat, barley, or rye. However, cross-contamination with other gluten-containing grains may mean that the product actually contains gluten despite the label.
  • Health Claims: While the FDA restricts the use of health claims such as “may reduce the risk of cancer,” there are many other ambiguous health statements that are completely unregulated, such as “helps the immune system.”

In addition, the FDA requires that any food product containing any of the eight major food allergens (milk, eggs, fish, crustacean shellfish, tree nuts, peanuts, wheat, and soybeans) list the allergen on the label and provides specific guidelines for how they are listed. For other allergens, such as rice or seeds, the FDA does not provide guidelines for labeling, so consumers should be diligent when choosing these foods.

Fraud in Common Food Products

The U.S. Food and Drug Administration (FDA), defines food fraud as the adulteration, dilution or mislabeling of goods. The Department of Homeland Security further defines food fraud as, “the deliberate substitution, addition, tampering or misrepresentation of food, food ingredients or food packaging, or false or misleading statements made about a product for economic gain.” The U.S. Pharmacopeial Convention (USP), a scientific nonprofit organization that helps set standards for the “quality, safety and benefit” of foods and medicines, released a study in January of 2013 regarding the prevalence of food fraud. The report found evidence of fraud to be the most prevalent in olive oil, milk, saffron, honey and coffee. Additionally, tea, fish, clouding agents, maple syrup and spices (turmeric, black pepper and chili pepper) were also commonly reported.

Additionally, the continually increasing amount of foods being imported creates additional risk for consumers. A recent FDA-sponsored report found that the amount of foods imported into the U.S. has tripled over the last decade, most significantly are the imports of seafood, fruits, nuts and vegetables. These products can be risky because the labeling requirements and enforcement can be more lax depending on the country of origin. Foods or supplements claiming medicinal or nutritional benefits can fall under this category as well.

Common types of food fraud occurs when producers:

  • add fillers (such as by adding another plant’s leaves to tea leaves),
  • mix in less expensive spices with high value spices
  • water down liquid—for example olive oils replaced and/or diluted with cheaper vegetable oils

While these practices may seem small in isolation, there is no way of knowing how many times, or with what, products have been diluted or supplemented. The aggregate can be quite substantial.

Loophole Labeling

Another kind of deceptive practice in food labeling, sometimes referred to as “loophole labeling” occurs when manufacturers take advantage of less stringent labeling requirements, and thereby label their packages in non-transparent ways.

Perhaps one of the most blatant examples of this practice occurs with products claiming to contain “zero trans fat.” Cookies, peanut butter, cereal, breads, and numerous other food products, are able to declare zero trans fat on a package’s nutrition facts panel (even though they do in fact contain them), because under the current U.S. Food and Drug Administration (FDA) regulations, as long as the total amount of trans-fats in a product is under 0.5 grams per serving, the company can put a 0 on the label. Consumers who eat two or three servings of a “trans fat free” product may well be consuming a combined amount of over one gram. The only way to know for certain is by checking the ingredient list.

Another example of this loophole labeling can occur with products that claim to contain no monosodium glutamate, which is required to be declared on a label. Many manufacturers will use taste additives to enhance the flavor of their products that are closely related to MSG, and may carry the same health risks, yet do not trigger the MSG labeling requirement. Loophole labeling is certainly not limited to these two examples. Consumers should be sure to check the full ingredient list, especially if you have any food allergies.

For additional information regarding labeling requirements, and for more helpful information for consumers, you can visit the USDA Fraud & Nutrition Misinformation page.

Your Rights as a Consumer

Consumers who believe they have suffered injury as the result of healthcare or food product fraud may have a claim for damages. Illinois statutes prohibit various deceptive trade practices, including knowingly representing that products have certain qualities or benefits when they do not. Federal statutes and regulations regarding the safety and quality of healthcare products, including drugs, dietary supplements, and medical devices, may assist in demonstrating actual knowledge of the falsity of a claim about a product’s benefits.

Based in the Chicago area, the healthcare product fraud lawyers at Nationwide Consumer Rights bring decades of experience with consumer rights litigation. We have dedicated our practice to exposing rip-offs and frauds and fighting to get consumers the healthcare services they have paid for. To schedule a free and confidential consultation with one of our Chicago healthcare product fraud attorneys, please contact us online or at 630-333-0000.

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