The NZ Muscle Scandal - Serious Questions
- Gary Moller
- 1 day ago
- 9 min read
What's the fuss?
The allegations include expired or short-dated supplements being sold without adequate disclosure, imported products being relabelled, unfavourable customer reviews being concealed, questionable claims about product contents, and foods being handled or packed under conditions that appeared to fall short of acceptable hygiene standards.
One operator, many serious questions
Before reading further, I encourage you to watch this investigation into NZ Muscle. It runs for about 45 minutes and raises questions that should concern everyone who purchases, sells or recommends sports nutrition and natural health products.
These are not minor matters when the products involved are intended to be swallowed by people who are relying upon the information printed on the packet. The people involved are being given the opportunity to answer the allegations, but, so far, some of their answers are coming across as weak excuses. They are digging deeper holes. However, it is important that the authorities complete their investigations before every claim circulating online is declared proven. A YouTube investigation is not a court of law, even when the evidence presented appears compelling.
This is no longer merely an argument taking place on YouTube or social media. NZ Muscle has now acknowledged packing and labelling problems involving several product lines, while disputing other allegations. The company removed affected products from sale, offered refunds and apologised to customers. New Zealand Food Safety and the Commerce Commission are also investigating aspects of the business. Fairness requires that we report what has been alleged, what has been admitted, what remains disputed and what the authorities eventually establish.
NZ Muscle’s reported response can be read here. I think it is a weak response. But that's my take.
A YouTube investigation is not a court of law, even when the evidence presented appears compelling.
A recall is more than poor publicity
New Zealand Food Safety has confirmed the recall of certain NZ Muscle and No Brand creatine products because of the possible presence of undeclared milk. For most people, a little unexpected dairy may be no more than an irritation, but for somebody with a severe milk allergy, an inaccurate label may have serious consequences. No associated allergic reactions had been reported when the recall was announced, but that does not make the labelling failure unimportant. The New Zealand Food Safety recall announcement can be read here.
A customer cannot inspect a scoop of white powder and determine whether it contains milk, the stated quantity of creatine or protein, or an undeclared substance that could cause an athlete to fail a drug test. The purchaser has no choice but to trust the label and the business standing behind it. Once that trust is lost, every statement on the packet becomes open to doubt.
The same applies to expiry dates and country-of-origin claims. People may pay a premium because they believe they are purchasing a fresh, high-quality New Zealand product made from New Zealand ingredients. If an imported or dated product is repackaged and presented in a way that creates a false impression, the injury is not limited to the person who paid too much. It also disadvantages the genuine New Zealand producer, like mine, who has gone to the expense of sourcing good ingredients, maintaining clean production, testing batches and complying with the rules.
The purchaser has no choice but to trust the label and the business standing behind it. Once that trust is lost, every statement on the packet becomes open to doubt.
Honest New Zealand businesses carry the cost
I am not commenting upon this affair as a distant observer. I work in the natural health industry, and the reputational damage reaches all of us. Every time a supplement business is accused of cutting corners, customers begin to wonder whether the powder, capsule or oil sold by everybody else can be trusted. Practitioners who recommend supplements as part of a carefully considered health programme are placed under suspicion, while responsible manufacturers and retailers have to work even harder to prove that they are not doing the same thing.
If the wider allegations are substantiated, there is another commercial injustice that deserves attention. A business able to obtain dated products at very low cost, relabel them as premium New Zealand products and sell them at a handsome margin gains an advantage that honest businesses cannot match. The responsible operator is paying for better raw materials, clean facilities, testing, traceability, compliant labels and trained staff. The alleged corner-cutter avoids some of those costs, undercuts competitors or spends the extra profit on expansion, and then grows rapidly within the same market.
Meanwhile, genuine New Zealand businesses are going to greater expense to produce real New Zealand products using premium New Zealand-grown ingredients, while their margins are squeezed from every direction. They are expected to compete with imported goods, absorb rising freight and compliance costs, pay New Zealand wages and then explain why their honest product costs more. If another business is gaining market dominance through practices that would not survive proper scrutiny, it is simply not fair. Good New Zealand businesses playing by the rules can be squeezed out by those who allegedly are not.
That is why firm investigation is in the interests of the entire natural health and sports nutrition sector. Protecting an industry does not mean protecting every operator from consequences. Sometimes the best way to defend the many is to deal decisively with the few who have placed everybody else’s reputation at risk.
Good New Zealand businesses playing by the rules can be squeezed out by those who allegedly are not.
What customers are entitled to expect
If the wider allegations are substantiated, those responsible should be dealt with firmly. Consumers are entitled to expect that a product contains what its label says, allergens are declared, expiry information is not concealed, advertising is truthful, reviews are not manipulated to create a false impression, and anything intended for human consumption is handled under clean and properly controlled conditions.
These are not unreasonable demands dreamt up by bureaucrats with too much time and too many clipboards. They are the foundations of honest trade. When I recommend a product, I am placing part of my own reputation behind it. When a parent buys a protein powder for a young sportsperson, or an athlete chooses a supplement believing it has been properly tested, the supplier is asking for the customer’s trust. That trust must be earned and protected.
Sportspeople carry an additional risk because contamination may lead to a positive drug test even when there was no intention to cheat. Testing for prohibited sporting substances and testing whether a product actually contains the ingredients and quantities stated on its label are not the same thing. A certificate addressing one question should not be used to imply that every other question has been answered. The distinction, and the wider regulation of supplements, has been reported by 1News and RNZ.
When I recommend a product, I am placing part of my own reputation behind it. That trust must be earned and protected.
There were already rules
There is already a considerable body of law addressing these matters. The Fair Trading Act prohibits misleading conduct and unsubstantiated representations. The Food Act, applicable food standards and the Dietary Supplements Regulations cover such matters as safety, hygiene, composition, labelling and allergen declarations. Advertising standards require health advertising to be truthful, responsible and supported by suitable evidence.
New Zealand businesses are not permitted to put anything they like into a packet and write whatever takes their fancy on the label. The person placing a product on the market is responsible for ensuring that it is safe, of acceptable quality and compliant with the law. Serious breaches of the Food Act that endanger public health may already attract substantial penalties. The central question raised by this affair may therefore be less about an absence of rules and more about whether the existing rules were followed, monitored and enforced.
Regulators cannot stand beside every mixing bowl, packing bench, storeroom and computer screen in the country. A system must depend to some extent upon businesses behaving honestly and meeting their obligations. However, when complaints, insider information or credible investigative work bring serious concerns to light, the response needs to be timely and competent. Rules that sit quietly in a filing cabinet do not protect anybody.
There is also a lesson here for every health business, including my own. Know where the raw materials came from. Keep proper batch and expiry records. Verify important claims rather than repeating what a supplier has told you. Declare allergens. Train the people handling food. Publish genuine reviews, including the occasional grumble. If a mistake is found, correct it promptly, compensate the affected customer and tell the truth. Embarrassment is unpleasant, but attempted concealment has a habit of becoming much more expensive.
The central question may be less about an absence of rules and more about whether the existing rules were followed, monitored and enforced
Allow the investigations to do their work
Accountability must be directed at the conduct actually established. There is a difference between an isolated clerical error corrected promptly, careless systems allowed to continue, and deliberate deception for commercial gain. Good enforcement recognises those differences and applies a response proportionate to the seriousness, duration and consequences of the conduct.
The same discipline should apply to public commentary. Once a person or business has been convicted on social media, a later correction seldom travels as far as the first accusation. NZ Muscle must answer legitimate questions, cooperate fully with the authorities, honour its commitments to customers and correct any deficiencies. It must also be judged ultimately upon the evidence, not every rumour that attaches itself to the story.
Former boxer and social activist Dave Letele became chief executive in July and took a shareholding in the company. He said he wanted to discover what had happened, rebuild the business and protect the jobs of its 35 staff, who should not automatically be blamed for decisions made above or around them. Sales had reportedly fallen sharply after the allegations became public. His appointment and comments were reported by 1News and RNZ. I think this interview was a train wreck for him; he was clearly the wrong person for the job, and it was no surprise to me that he quit just a few days later, saying:
"I've decided to step back from NZ Muscle."
"I came in with the best of intentions, to help a business front up and fix things properly. I've realised I can't help in the way it needs, and the right thing is to be honest about that.
"I wish the team well, there are good people there working hard to get it right.
"Back to the work I've always done. Thank you to everyone who backed me."
A new captain may help, but he still needs a seaworthy ship.
Do not punish the whole industry
The NZ Muscle scandal raises serious questions requiring firm investigation. However, it must not become an excuse to smother every responsible New Zealand health business in still more regulation. If the allegations are substantiated, use the laws already available, identify who was responsible and impose consequences that match the conduct. Do not send another mountain of compliance paperwork to businesses that were already doing the right thing.
One reckless operator can damage a reputation that hundreds of responsible businesses have taken years to build. The answer is not to assume that everybody in the industry is reckless. It is to make dishonesty, unsafe handling and misleading labelling difficult to conceal and costly when proven, while allowing honest businesses room to operate.
This affair will therefore test more than NZ Muscle. It will test New Zealand’s regulatory judgement. Can our authorities deal firmly with a specific problem, or will politicians use the public anger surrounding one business to justify a much wider expansion of control?
That question leads directly into my follow-up article, which will be published in a few days. New Zealand is again considering how natural health products should be regulated, and a genuine scandal creates ideal conditions for overreaction. Something has gone wrong, the public is understandably concerned, and officials feel pressure to show that they are keeping us safe. Before long, the conduct of one operator may become the excuse for controlling thousands of responsible businesses, practitioners and consumers who had nothing to do with it.
First establish what happened at NZ Muscle. Enforce the laws already protecting customers and honest competitors. Then, before wrapping the entire natural health sector in another kilometre of red tape, let us ask whether more regulation would have prevented the alleged conduct, or whether the real failure was that existing rules were not properly followed and enforced.
One reckless operator can damage a reputation that hundreds of responsible businesses have taken years to build. The answer is not to assume that everybody is reckless.
Before wrapping the entire natural health sector in another kilometre of red tape, let us ask whether more regulation would have prevented the alleged conduct. This will be the subject of my follow-up article coming shortly.
Medical disclaimer
This article is provided for educational and public-policy discussion. It is not personal medical advice, diagnosis or treatment. Supplements may cause adverse effects, contain allergens or interact with medicines. Competitive athletes should also consider contamination and anti-doping risks. Always consult an appropriately qualified healthcare professional regarding your circumstances, medications and health conditions.
Natural health products, sports supplements, NZ Muscle, consumer protection, proportionate regulation
You are so right. Honest businesses incur a certain cost for being honest. But the alternative of micro-regulation and inspection has to be the most expensive of all. This raises the whole point about a "high trust society" and how much better everything works. A society with low trust lacks an essential lubricant for smooth economic transacting and hence growth. It is something the western world learns anew at its peril.