Investigation Unit: Fair Trade Fakes

Fair trade products are catching on in popularity as more and more consumers put their money where their conscience is.  However, as the dollars flow, so comes the controversy of companies pretending to be fair trade when they're not. What's a consumer to do? Victor Sotelo explains.

Sarah Griffis loves the idea of buying products that she knows will make a difference in the lives of those who create them.

"It's a great cause to support," said Griffis.

So she shops for fair trade products when she can.

"Fair trade is a different way of doing business, in which buyers and sellers work directly with farmers and crafts people in developing countries to make sure that they have a sustainable way of earning a living," said Renee Bowers of the Fair Trade Federation. 

More fair trade certified products than ever are now sold in the US, from 6,000 in 2009 to 9,500 in
2010, and company requests for the labels are skyrocketing.

Great news, right?
Yes, except the growing popularity of fair trade products is also attractive to those with less honest intent.

Megy Karydes of World-shoppe.Com said, "What's going right now on in the fair trade industry is what we're calling fairwashing. It's a play off of the term greenwashing, where some companies are claiming to be fair trade and may not necessarily be fair trade so the onus falls on the consumer to ask the right questions, find out why is it fair trade, what makes it fair trade?"

There are logos and certifications the products and companies selling them can apply for from groups such as the Fair Trade Federation or Fair Trade USA but if a company decides to exploit the label and make false claims, which critics say is happening more and more.

In fact, the national advertising division of the better business council recently notified one major
company to stop using photos that overstate the fair trade befefits of buying a product that had
minimal fair trade ingredients.

"There really are no penalties because there is no legal governing body for fair trade so to speak," said Bowers.

In some cases, a company may have one fair trade product among dozens of others, but promote the entire brand as being fair trade. Or, they may use a token amount of fair trade ingredients in the product.

"Having 2% raw materials in your bath and body product does not make you a fair trade product, but using that label on your packaging may give consumers the false impression that their products are fair trade," said Karydes.

It upsets Sarah that companies could take advantage of her good intentions

"I would feel definitely cheated if i found out something i bought that i
Believed was fair trade was not," said Sarah.

So, the fair trade federation suggests consumers who care about finding fair trade products look for
labels and certifications but then dig deeper.

Bowers said, "One of the questions that you need to ask if you see a fair trade label is, for instance, which ingredients are fair trade. If you're looking at a food product, are all the ingredients produced in a fair trade manner or just some of the ingredients?"

"Seek out those products that have those labels but ask more questions. It's not as easy as taking it at face value," said Karydes.

Some of the biggest product categories for fair trade include coffee, flowers, and produce.

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