Egg fraud: 'I regret terribly what I've done'

PHOTO/JOHN STONE

Free range egg scammer warns he's not the only one.

The former egg producer whose packaging scam put the spotlight on the New Zealand industry is predicting a huge drop in the availability of free-range eggs on supermarket shelves.

That is because the publicity surrounding his case will frighten other suppliers into quitting passing off cage eggs as free range, says John Garnett, who was sentenced in Whangarei Court this week for fraudulently labelling millions of eggs as free range.

Mr Garnett said supermarket chains' demands on his Forest Hill Farm business to supply free range as well as cage-laid eggs, or lose his entire contract, were part of a downward spiral that saw him lose his business, health and reputation.

He falsely labelled cartons over 20 months in 2010 and 2011 when he became unable to buy in enough genuine free-range eggs from other producers to meet his supermarket contracts.

Ironically, the disgraced egg producer is now suggesting guidelines he thinks will protect the industry from other operators doing the same. They include measures to separate free and cage egg supplies to the retail sector and to better identify them. Mr Garnett claims it has long been obvious there are more so-called free-range eggs for sale than the country's farms can actually produce.

He is remorseful about the decisions he made but hopes his experience will help lead to more transparency over whether eggs are from free range, barn or cage hens.

Mr Garnett said he is not making excuses for deliberately deceiving the market but he believes the depression he was suffering, exacerbated by commercial pressures, played a role in his making bad decisions. As well as trying to hang on to the second-generation business, he had 20 staff whose jobs he felt responsible for, he said. He was also having employment issues with his then farm manager who was also aware of the scam.

Word about the false packaging eventually got out, leading to "a loss of 40 per cent of customers overnight".

"I managed to struggle on for another year then went into voluntary liquidation. The Commerce Commission had already started investigating by then."

A Commerce Commission spokesperson confirmed the process had started after a whistle blower alerted the egg industry, which in turn laid a formal complaint.

By then Mr Garnett had been expelled from the Independent Egg Producers' Co-op. Added to that shame was the court case, the lifting of name suppression at this week's sentencing, and the 12 months' home detention and 200 hours community service he was given.

"I regret terribly what I've done. I had been trying to rectify the situation when it all fell apart. I'm actually looking forward to doing my community service, giving something back. It's a way of apologising to the community."

As for his claim others are doing the label scam, the egg industry is adamant it isn't happening.

"But it's just that no-one else has been caught," Mr Garnett said.

The Commerce Commission has enough information to investigate others for the same deception, he believes. However, the commission spokesperson told the Northern Advocate it has no evidence to back up Mr Garnett's claims, although it "would follow up on any information provided [to it] that suggests other breaches are occurring".

In the meantime, Mr Garnett says 99 per cent of egg farmers are "good, honest people" - but he predicts reaction to his own sorry tale will show up in the form of a free-range egg shortage on shelves as one or two other producers hurriedly clean up their act.