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The motive for doing so was simple — it was less costly for the Corporate Defendants to produce cheap, fake cheese while customers paid premium prices for real cheese

The other two companies charged — Universal Cheese & Drying Inc. and International Packing — also pleaded guilty earlier this year to charges of conspiracy and money laundering. Those companies are no longer operating and have been unable to pay $1 million in fines that were part of their plea agreements.

“The motive for doing so was simple — it was less costly for the Corporate Defendants to produce cheap, fake cheese while customers paid premium prices for real cheese,” prosecutors wrote in the sentencing documents. The companies “reaped the benefit of the difference between the lower costs and the higher revenue.”

Agents from the Food and Drug Administration and the Internal Revenue System raided company facilities in January 2013 after getting a tip about the fake cheese from a former employee. Afterward, the company used real ingredients, causing profits to plunge, according to court documents. Castle Cheese is now in bankruptcy proceedings.

Incorrect or false-label claims in 100 per cent grated Parmesan products are a problem in the U.S., with some companies looking to save money by using filler such as cellulose, an anti-clumping additive derived from wood pulp, Bloomberg News reported in a Feb. 16 article. In a test of common 100 per cent grated Parmesan brands by an independent lab, Bloomberg News found cellulose levels of as much as 8.8 per cent.

While the FDA normally prosecutes cases that harm the health or safety of consumers, rather than simply fraud, in Myrter’s case, “the conduct is no less concerning,” prosecutors wrote in papers filed with the court. Substitution of ingredients can “drastically” alter profits, creating a strong incentive to adulterate food.