FSMA and Supply Chain Security

1. FSMA and Supply Chain Security Andrew Wynter MSc, CPP, PSP, PFSO. Compliance and Investigations Manager GIA Grace Kennedy

2. Setting the context: Big Jamaican drug find overseas - Canadians seize C$19m in contraband among shipment of pumpkins Canadian police have seized more than 626 kilograms of hashish, hash oil and ganja stashed under a shipment of Jamaican produce including pumpkins, yams and sweet potatoes. The drugs, with an estimated street value of C$19 million (J$1,086,800,000) were discovered on July 22 wrapped in plastic and hidden under a false floor in a container shipped to Halifax, Nova Scotia, on the Atlantic Coast.

4. FSMA and Supply chain Security SEC. 103. HAZARD ANALYSIS AND RISK-BASED PREVENTIVE CONTROLS REQUIRES THAT The owner, operator, or agent in charge of a facility shall, in accordance with this section, evaluate the hazards that could affect food manufactured, processed, packed, or held by such facility, Identify and implement preventive controls to significantly minimize or prevent the occurrence of such hazards and provide assurances …..monitor the performance of those controls, and maintain records of this monitoring as a matter of routine practice.

5. Components of a Supply chain • Primary & Secondary source • Transportation • Production or processing facility • Warehouse / storage facility • Distribution center • IT / communication • Wholesale or retail facility • Customer/ consumer

6. Example of a Modern Supply Chain

7. Hazards that can affect the Supply chain • Piracy • Narcotic/ weapon smuggling • Regulations • Counterfeiting products • Diversion/ hijacking • Organized crime • Natural / manmade disasters • Contamination • Biological • Chemical • Physical

8. Hazards that can affect the Supply chain cont’d • Pilferage • Fraud • Labor unrest • Weather • Sabotage • Inadequate Security • People (Employee, suppliers, customers)

9. Supply chain vulnerability. • Any point along the chain • Transportation • Warehouses, • DCs, storage yards, • Manufacturing • packaging facility ( Cargo at rest is cargo at risk) • Anyone who has access to your products • Organized crime networks • domestic • international

10. Addressing hazards affecting the supply chain • Identify – Threats , hazards, • Assess – Threats, hazards (Risk assessment ) • Develop – Plans, procedures, and program to mitigate threats, hazards. • Implement – program • Monitor and review – program, processes, procedures • Implement corrective action program

11. FSMA and Supply chain Security Elements of Supply chain SECURITY DETAILS

12. Supply chain security (People) • Detailed background checks • Awareness training • Pre-employment / recruiting screening • Psychometric testing for honesty • Detailed background checks • Drug testing • Well designed and relevant policies and procedures • Whistle blowing or reporting program • Well conducted Investigations • Creation a culture of honest or risk intelligent culture

13. Supply chain Physical Security • Construction of the facility • Access control • CCTV • Intrusion detection • Perimeter equipment (Fencing, Walls etc) • Guarding operations • Key control • Screening policies and procedures • Lighting

14. Supply chain conveyance • Registered or approved haulage contractors • Registered and approved air and sea carriers • Use seals that meet international specification • Proper custody and documentation • Seals should be distributed in sequential order • Seals should be properly secured • Audit seals regularly • Shipper should sign as an indication that they are in possession of seal(s) • Keep proper records of seals issued and received • Damaged or unused seals should properly destroyed • Inspect seals before and after installation

15. What regulators are looking for in the program • Regular auditing and reviewing of processes • Compliance reports • Security assessments • Self assessments reports • Corrective action plans reports • Properly organized and maintained records • Change management process • Up to date certifications

16. What regulators are looking for in the program • Risk assessment • Training and awareness ( staff & suppliers) • Well developed security program • External audits, and reviews • IT Security • Properly documented procedures and processes

17. Benefits of good quality supply chain security program • Protects your brand revenue and reputation • Reduces cost • Improves efficiency of process • Builds confidence with your customers • Builds confidence with your suppliers • Build confidence with the regulators • Deters criminal activity • Opens opportunity in new markets

18. Summary of a high quality Supply chain security program • Well develop security plan • Plan is owned and driven by management • Staff are trained on the supply chain security plan • Contracts have a clauses to address risk • Robust IT system with security protocols • Good relationships with law enforcement and security professionals • Facility for employees and/or third parties to make reports • Reported incidents are fully investigated • Monitoring and reviewed regularly.

19. Internationally recognized standards and programs that support supply chain security • BASC, • CTPAT, • ISO 28000 – Supply chain • ISO17712 – ( Mechanical )Freight Seals • ISO 31000- Risk Management • ISO22000 • FSSC/ HACCCP • ISPS Maritime Security Codes

20. Little things that make a big difference • Fit and proper persons or companies • No cleaning of containers or packages • No inspection of containers • Errors and mistakes on documentation • Weak security controls and practices • Out of date certifications • Poor record keeping • Poor employment practices

21. Supply chain Security Minefield or opportunity depends on how you manage your program QUESTIONS