Table grape exporting company hit with AUD$1M fraud fine

Australia’s largest table grape exporter has been hit with a fraud fine of more than AUD$1 million (a bit over $650,000) after conducting a “sophisticated fraud” scheme that posed the risk of introducing a pest to New Zealand, multiple outlets have reported. The Grape House was convicted in the NSW District Court for breaching biosecurity arrangements between the two countries.

According to Australia’s Department of Agriculture, Fisheries, and Forestry, the company submitted false or misleading documentation to the department to obtain phytosanitary certification and permits to export the grapes during the 2017 and 2018 export seasons.

The Grape House then claimed that 145 tons of grapes originated from South Australia and that they were grown in a “fruit fly pest-free area.” In reality, the fruit came from various non-­fruit fly pest-free zones, as the company sought to avoid a 16-day cold storage disinfection requirement. 

Australia’s Department of Agriculture found that the company’s actions were “deliberate and sustained.” Meanwhile, District Court Judge Robert Newlinds SC, noted that the scheme was motivated by a desire to speed up cash flow, saying it involved “a significant degree of sophistication and planning.”

The scheme’s exposure was revealed to involve Charlie Costa, the company's sole director, who was aware of the actions of Colin Egan, the former warehouse and logistics manager. Egan signed false transfer certificates about the grapes’ origin, and Judge Newlinds indicated there was “no suggestion” Costa was unaware of Egan’s actions. 

Judge Newlinds emphasized that the offense was premeditated, involved “considerable experience,” and was not a mistake or slip. He highlighted that although fruit flies did not enter New Zealand, this was “good fortune,” and the fraud risked compromising biosecurity and the reputation of Australian exports. 

The AUD$1,050,000 fine was handed down in Penrith District Court on August 8. 

The Grape House has operated since 1989 and remains an active company. 

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