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Our legally-constituted artisans cooperative has been a supplier to 'Fair Trade' retailers since 1975 at an average of 5000usd$/month in product sales. The Fair Trade umbrella organization publishes these same 'Ten Fair Trade Principles', without amendment all these years. These Principles are proudly reproduced on many of the FT retailers' web-sites. Retailers are licensed to make such claims by paying membership fees in an umbrella org.

However, these Principles are intended for consumption by the consumers and not intended to be read by the suppliers or applied to us. In any case, these principles are not honored in practice and never have been. Symbolic gestures are referred to from time to time, but the degree of cynicism has grown greater and greater as these Principles diverge from practice.

FAIR TRADE PRINCIPLE #1

Fair Trade is a strategy for poverty alleviation and sustainable development. Members create economic opportunities through trading partnerships with marginalized producers. Members place the interests of producers and their communities as the primary concern of their enterprise.

Do Fair Trade businesses really "place the interests of producers and their communities as the primary concern of their enterprise"? Of course, they do not. Is this criminal fraud?

FAIR TRADE PRINCIPLE #2

Fair Trade involves relationships that are open, fair, consistent, and respectful. Members show consideration for producers by sharing information about the entire trading chain through honest and proactive communication. They create mechanisms to help customers and producers feel actively involved in the trading chain. If problems arise, members work cooperatively with fair trade partners and other organizations to implement solutions.

In the experience of our group with Fair Trade, we have never been treated with respect. We have always been coldly handled in the way that Walmart, for example, treats its suppliers.

When we privately asked for consideration of the fact that we were selling below cost, this crucial observation was angrily taken as if we had betrayed the Fair Trade movement and as a result our cooperative was the subject of calumny and was blacklisted among the members, no matter that fifteen artisan families lost their employment income as a result.

Becasue our product is so well-received by the public, we thought we could ask for a raise. In december 2017, we were selling from the same price-list as in the year 2000, even though the cost of materials and of everything else had gone up significantly in that time interval.

FAIR TRADE PRINCIPLE #3

Fair Trade is a means to develop producers’ independence. Members maintain long-term relationships based on solidarity, trust, and mutual respect, so that producers can improve their skills and their access to markets.

Our Fair Trade distributor, far from acting to improve our access to markets, monopolized our unique jewelry product and tried to keep retailers from contacting us directly. We never experienced any solidarity, trust, nor mutual respect. Fair Trade buyers unsuccessfuly attempted to reproduce our product on several ocassions. Our principle buyer changed one letter of our name and trademarked this in a transparent attempt to hijack our identity.

FAIR TRADE PRINCIPLE #9

Fair Trade celebrates the cultural diversity of communities, while seeking to create positive and equitable change. Members respect the development of products, practices, and organizational models based on indigenous traditions and techniques to sustain cultures and revitalize traditions. Members balance market needs with producers’ cultural heritage.

there was no effort whatsoever put into identifying the features of our cultural traditions. This statement of principle was intended to convince the buyer of something that is untrue.

Our cooperative was an important supplier to the Fair Trade markets since 1975; One has never heard of a supplier who was treated according to these principles. In the beginning, Fair Trade was created by world-travellers, idealistic entrepeneurs and third world artisans. Over the years it evolved into a cynical buy-sell business like any other, only with a twist:

The Fair Trade consumer is motivated to purchase because he or she believes that such a purchase benefits a creator community, when this is so much hokum. Is this criminal fraud?

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  • Which side is the questioned fraudster — suppliers, retailers, or the umbrella org?
    – Greendrake
    Jan 5 at 5:19
  • It is the umbrella org also commercial distributors (intermediaries) selling to Fair Trade retailers Jan 6 at 0:34
  • WHY is my question marked minus 1? I'm still coming to grips with how Stacks works. Jan 6 at 1:14
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    The current "−1" is simply because 2 people have voted down and only 1 up. It is nothing to worry about unless those who voted down have explained why, which they have not. People often downvote just because they are assholes.
    – Greendrake
    Jan 6 at 2:10

1 Answer 1

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Since you have tagged Ohio, and are asking about criminal fraud, the relevant laws contained in Chapter 2913 of the Ohio Revised Code, specifically sections 2913.01 (Definitions) and 2913.02 (Theft). From a brief read through, the answer appears to be "yes in theory, but not clearly, and even if so, hard to prove". (Disclaimer, I am not a lawyer).

The definition of "deception" is potentially encouraging (from 2913.01):

"Deception" means knowingly deceiving another or causing another to be deceived by any false or misleading representation, by withholding information, by preventing another from acquiring information, or by any other conduct, act, or omission that creates, confirms, or perpetuates a false impression in another, including a false impression as to law, value, state of mind, or other objective or subjective fact. (Emphasis mine).

However, deception is not a crime by itself. What could be a crime is theft by deception, namely violation of 2913.02(A)(3): "No person, with purpose to deprive the owner of property or services, shall knowingly obtain or exert control over either the property or services...by deception".

This would require the proving of the premise that "The Fair Trade consumer is motivated to purchase because he or she believes that such a purchase benefits a creator community", rather than say, because they like the jewelry's style and that doing so does not benefit the specified community.

Deceptive advertising is covered by Ohio Revised code Chapter 1345, which is substantially similar on the basis of deception.

Regarding Trademarks: I'm not an expert in trademark law, however, trademarks are intended to prevent confusion in consumers, not to establish identity. Essentially, a trademark is a "descendent" of the European artisan tradition of the "maker's mark", but that does not mean the maker is the only one allowed to sell things with that mark. Coca-Cola has trademark on it's soda (and a wide variety of other drinks as well); I am allowed to sell those products without Coca-Cola's permission (provided I bought them from their legal owners), I just can't sell something that is not Coca-Cola with a Coca-Cola label on it.

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  • The definition of "deception" from Ohio from 2913.01 as stated above fits the case like a glove. So does "theft by deception" namely violation of 2913.02(A)(3): "No person, with purpose to deprive the owner of property or services, shall knowingly obtain or exert control over either the property or services...by deception". Ample evidence is available to supply proof. Deposition of the Defendant would leave no doubt. If required to Depose the Defendant would undoubtedly seek a negotiated settlement. Jan 6 at 0:57
  • A harder challenge would be the proving of the premise: "The Fair Trade consumer is motivated to purchase because he or she believes that such a purchase benefits a creator community", rather than say, because they like the jewelry's style and that doing so does not benefit the specified community." It is common sense that when a consumer purchases Fair Trade coffee instead of Maxwell House, it is specifically becasue of the purported benefits accruing to the coffee farmers. Certainly Fair Trade tends to market its merchandise exclusively on the claim that a purchase benefits the producer. Jan 6 at 1:01
  • The distributor with whom we have a detailed complaint is in Ohio (Cleveland area), The umbrella organization is in Pennsylvania and is incorporated in Delaware. Jan 6 at 1:16
  • @MariaAlaniz: You tagged Ohio in the question, so I responded that (Delaware incorporation is irrelevant for this question, seemingly every large business in the US business is incorporated in Delaware for tax reasons), but the overarching details are unlikely to change. Note you asked about criminal fraud; criminal actions in the US must be proven to a standard of "beyond all reasonable doubt".
    – sharur
    Jan 6 at 14:04
  • The very least of our concerns is our ability to prove, far beyond all reasonable doubt. The complete GMail record is a trove of evidence. The cooperative's former distributor in Ohio will wilt when presented with a deposition order will be willing to talk with us. What is important here is the sense of guilt they have, if not in a moral sense, then in a legal sence. They know that everything we say is true and that we can readily prove it. I doubt they will want to bother the judge about our case. And we are easy. All we want is for them to reverse their malevolent calumny and bad-talking us. Jan 6 at 18:12

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