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Thursday, 24 January, 2002, 13:12 GMT
Japan firm admits BSE cash scam
Supermarket in Kobe, Japan
Packs of Snow Brand Foods being removed from the shelves
By BBC World Business Report's Doreen Walton

A Japanese food company has admitted cheating the government over a programme to buy up beef unsold after an outbreak of mad cow disease, or BSE.

The Snow Brand Food Company said employees had repackaged beef from Australia, pretending it came from Japan, in order to win government compensation.

When the allegations were first made in Japanese newspaper the Asahi Shimbun Snow Brand initially issued a strong denial.

Now the company's president, Shozo Yoshida, has admitted the scam did take place.

He apologised and said Snow Brand would repay the government money it had received.

The Japanese government offered to buy unsold beef after news of Japan's first case of BSE prompted a sharp fall in beef sales.

Damaged reputation

Mr Yoshida said the scam took place at the company's Kansai Meat Centre facility.

The story has once again tarnished Snow Brand's reputation among the general public and on the Tokyo stock market where its share price has fallen steeply.

A year and a half ago, the company was implicated in the poisoning of 13,000 people in and around the Japanese city of Osaka, after a bacterial contamination at one of the company's local dairy plants.

BSE, bovine spongiform encephalopathy, was first discovered in Japan last September.

It is believed to have spread to Japan in imports of European animal feed.

The disease, which first broke out in Western Europe, attacks cow's brains and has been linked to CJD, a similar disease in humans.

See also:

14 Dec 01 | Asia-Pacific
Japan to destroy tonnes of beef
18 Oct 01 | Asia-Pacific
Japan unveils anti-BSE measures
11 Sep 01 | Asia-Pacific
Asia acts on Japanese BSE
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