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Fonterra launches internal probe into expired milk powder scam in China

By Mary Ellen Shoup contact

- Last updated on GMT

Fonterra is conducting an internal investigation after Chinese authorities arrested 19 people in Shanghai for selling the company's expired milk powder.
Fonterra is conducting an internal investigation after Chinese authorities arrested 19 people in Shanghai for selling the company's expired milk powder.

Related tags: Dairy giant fonterra, Milk

New Zealand dairy giant Fonterra has launched an internal investigation following the arrest of 19 people for selling approximately 330.7 tons (300 tonnes) of the company’s expired milk powder in Shanghai and other Chinese provinces. 

Chinese authorities seized 1.1 tons (100 tonnes) of the repackaged expired milk powder products manufactured by Fonterra and have shut down the websites selling them, according to Shanghai Daily.

The arrested suspects were reported by the New Zealand Herald to be part of a company based in China, which was repackaging expired Fonterra products into smaller packaging for resale below market prices, Shanghai Daily reported.

Fonterra spokeswoman Maree Wilson said none of the people arrested were Fonterra employees or associated with the company, but said that the company condemns the illegal business activity.

After a months-long investigation, the police discovered that one of the suspects arrested sold the expired products to another company, who allegedly resold nearly 220.5 tons (200 tonnes) to distributors in Shanghai and in the Jiangsu, Henan, and Qinghai provinces, who then sold them on e-commerce platforms or in the wholesale market.

Related topics: Regulation & Safety, Nutritionals, Fonterra

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