News | July 21, 1999

Dairymen Busted in Counterfeit Milk Ring

"Milk, the other illegal, white powder," would be a good advertising jingle for three officers in Pennsylvania who defrauded consumers and the government by passing-off milk powder as milk.

The three, officers from Bechtel Dairies Inc. in Royersford, admitted in federal court to conspiring to sell a mixture of powdered milk and water as being straight from the cow. Sentencing is scheduled for Oct. 13. Each could spend eight to 14 months in prison according to a news story from Reuters.

The U.S. Dept. of Agriculture (USDA) claimed that between January 1993 and December 1997 Bechtel Dairies labeled and sold more than 19 million pounds of a mixture of skim milk powder and water as "skim milk." The milk was sold to schools participating in federal food aid programs, Veterans' Affairs medical facilities, the Defense Department and retail stores.

USDA Inspector General Roger Viadero was quoted as saying, "At this time it does not appear that the defendants' actions caused a public hazard." The real issue is fraud.

A civil was filed against Bechtel last year in a case for which a settlement has yet to be reached. According to a March 10, 1998 newspaper story from the Philadelphia Inquirer, the dairy's assets were frozen and the company was denying the allegations.

Robert Bechtel, vice president of the dairy, was cited as issuing a statement saying, "In the 75 years my family has been in the dairy business, we have never misled or deceived any of our customers. Our products have always met all federal and state requirements."

The government lawsuit, filed on behalf of the U.S. Department of Agriculture and the Food and Drug Administration, alleged that about 80% of the Bechtel milk products tested were watered down or made with milk powder, mislabeled or misdated, and sometimes mixed with milk that was near its legal expiration date.

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