Horsegate scandal: why are the criminals still at bay?

It’s been 12 months since Horsegate broke, and still one of the food industry’s biggest whodunnit cases remains unsolved.

There are working theories, of course, and have been one or two arrests, but to date - and despite Defra’s Owen Paterson declaring in February that he expected “the full force of the law to be brought down on anyone involved in this kind of activity” - no successful prosecutions. The big question, of who was responsible for mixing horsemeat into frozen beef, is still unanswered.

It’s an uncomfortable situation for the food industry: on the one hand, no one likes having their dirty linen aired in public (as court cases almost inevitably would), but as long as the real culprits remain at large, it’s difficult for certain sectors - and companies - to shake off the cloud of suspicion hanging over them. So how come we haven’t seen more progress on the prosecution front?

Initially, there was a flurry of action, as the Food Standards Agency - together with the police - raided a number of premises and made arrests in early 2013. But there have been few public updates since.

One business, Farmbox Meats in Wales, which was initially investigated in the context of Horsegate, was ultimately shut down not for horsemeat reasons but on hygiene charges - and the owner, Dafydd Raw-Rees (who has always denied wrongdoing), has since opened a new business, Homeland Meats. Meanwhile, Peter Boddy Slaughterhouse in Yorkshire, which was investigated at the same time and initially had its operations suspended, was allowed to reopen in March.

Evidence was also seized at premises in Tottenham, London, but it is not clear to what extent these are still the subject of live investigations.

Tightlipped

The FSA and City of London Police, which is leading the UK horsemeat investigation, are staying tightlipped, confirming only that investigations are indeed still live.

But while not commenting on the case directly, FSA CEO Catherine Brown insists she remains hopeful prosecutions will ultimately be mounted. “It’s important to consumer confidence that it’s clear that there are legal penalties for people who break the law relating to food.”

In 2013, the FSA and local authorities brought about 400 prosecutions on food-related matters, “so it’s not that people are not prosecuted,” she adds - but highly complex cases like Horsegate are a challenge.

“The interesting issue with these more complex cases, particularly cases where there might be a connection to other criminal elements and other criminal activities, is that there is a challenge in how different bodies involved in the investigation work together,” Brown adds. Legal experts agree the complexity of the horsemeat scandal - which spanned numerous European countries and involved long and highly fragmented supply chains - is partly to blame for the lack of prosecutions thus far. “We are hearing from some police sources that this is up there with some of the most complex and difficult fraud cases they’ve ever seen,” says one industry source, while a legal source suggests it would be “almost more surprising if we actually had seen prosecutions already - these types of cases very rarely lead to successful prosecutions.”

His view is echoed by City of London Police. “This is an extremely challenging investigation, which includes criminal forensic examination that has never been done before,” says detective superintendent Bob Wishart. “We continue to work closely with the Food Standards Agency and UK police forces to determine whether horsemeat being used in a range of meat products was deliberate and co-ordinated criminal activity.”

Lack of robust evidence

Even where companies and public prosecutors are certain they have identified the source of horsemeat in their supply chain, it doesn’t follow evidence is robust enough to support a prosecution in a court of law.

“Fraud is always difficult to prove unless there’s a whistleblower and you have direct evidence,” says Hilary Ross, a partner with law firm DWF.

The pan-European nature of the scandal adds further difficulty, she adds. “Most of the activity appears to have taken place outside the UK, and the UK would not have the powers to identify and prosecute companies or people there. That would be up to the individual member states.”

There have been arrests and criminal investigations in other EU countries - most notably France and the Netherlands (see overleaf) - but as in the UK, no prosecutions have been successfully concluded to date.

Even establishing up-to-date information about what investigations are still being pursued across the EU is a challenge in itself, adds Ross. “We really need an EU-wide review that says clearly, ‘this is what happened, and this is what is happening now’. At the moment, it’s quite a piecemeal approach - there’s no eagle-eye perspective on the whole European picture.”

“Fraud is always difficult to prove unless there’s a whistleblower and you have direct evidence”

Hilary Ross, DWF

Of course, companies caught up in the scandal do not have to rely on public prosecutions to seek redress - they can take matters into their own hands and file private legal action. In the immediate aftermath of Horsegate, numerous companies vowed to do so, but to date there has also been precious little in the way of court action.

That’s not to say suppliers didn’t make good on their promise to take legal action - it’s just that cases of this kind are far more likely to settle out of court than go to trial. “If you sue your customer or your supplier, that’s pretty much the death nail in that relationship. That’s why nearly all these claims settle,” says Ross.

One notable exception is ABP Food Group, which is currently preparing to go to trial in Ireland with a claim against Poland’s Food Service, which it claims supplied it with beef containing horse DNA. ABP settled another case - against Cheshire-based Norwest - out of court earlier this year, but says it is intent on seeing the Food Service case through to its conclusion.

“This case for us is less about financial gain and more about accountability and reputational vindication,” says group livestock strategy manager Stuart Roberts.

Roberts says ABP intends to take its case to trial “as quickly as possible” - but though he still hopes action could be seen earlier, this is nevertheless likely to mean 2015. ABP has faced criticism for not launching action earlier, but Roberts says complex cases take their time. “Our priority on the emergence of the issue was to find the source of the problem and to prevent its recurrence,” he adds.

“Once those issues were completed, we turned our mind to seeking redress against those who supplied [us] with horsemeat. This was a complex issue, and as we stated at the time, we wanted to ensure our investigations were complete and to review the evidence and all available testing records before launching legal action.” (For its part, Food Service denies accusations it sold beef containing horsemeat.)

Comigel, the French ready meals manufacturer that produced the infamous Findus frozen lasagne, also intends to press ahead with private litigation. The company says it was supplied with beef contaminated with horsemeat by Spanghero, and has filed a complaint against persons unknown with a court in Paris.

Export manager Sabine Dahmani stresses it is taking the matter “very seriously,” given how much the scandal undermined consumer confidence and damaged the Comigel business. “Comigel was a real success story, with a penetration in almost 20 countries and with a wide range of quality products. This crisis has forced us to eliminate more than 120 out of 450 jobs - [which] is very unfair to our staff, managers and partners.”

Reputational damage

Although French prosecutors clearly stated Comigel was not itself under suspicion, the company suffered significant reputational damage, particularly in the UK, where some media reports wrongly suggested Comigel was responsible for the fraud, Dahmani claims. As a result, Comigel’s UK business has found it especially difficult to recover.

“Almost all Continental customers have restarted again, but it takes more time in the UK,” says Dahmani. Our UK customers have not yet re-started with the pasta dishes,” says Dahmani. “We are closely working together with them for other products that we are producing for the UK market.”

Comigel clearly has plenty of motivation to keep pursuing legal action, but Dahmani also warns not to expect results overnight. “The procedure will be long and [is likely to] take several years,” she says.

For the time being, therefore, sitting and waiting appears to be the only option. One year is a long time, but perhaps not enough to expect successful prosecutions given the sheer scale of the scandal. The risk, of course, is as memories of Horsegate fade, the urge to continue to press on with costly legal action might lessen. That would be a shame. In light of the uncertainty surrounding criminal prosecutions, private litigation, if seen through to trial, could be the last opportunity for light to be shed on those responsible. Here’s hoping those companies vowing trials today will stick to their word and not settle out of court - the public will surely thank them.