Foreign-grown potatoes are being passed off as British in the latest consumer scam to be uncovered by trading standards officers, The Times has learnt.

At least two leading retailers are under investigation for selling Israeli potatoes as “British new potatoes” and may face prosecution. They cannot be named for legal reasons.

Experts at the British Potato Council are now in touch with local authorities around the country to find out the scale of the fraud and to protect the £1.5 billion a year retail market.

The main problem is over the sale of potatoes sold loose in supermarkets, local shops and market stalls. About 80 per cent of potatoes are sold in supermarkets and experts believe that problems in the large retailers are down to accidental mislabelling.

Before the main harvest, British produce is often in short supply and shelves are stocked with foreign potatoes. As a result, some inaccurate labelling occurs.

But there is concern that some smaller traders may be anxious to boost their profits by selling potatoes with a British label. Rogue traders are easily able to cash in. Wholesale market prices for Israeli, Egyptian and Cypriot Estima potatoes are about £150 a tonne. British-grown King Edwards cost between £225 and £250 per tonne.

Similarly, new potatoes from Majorca or Italy will cost £300 to £400 a tonne, but prime regional speciality potatoes such as Jersey Royals fetch £600 a tonne. Produce sold within the area it is grown can achieve £800 to £1,000 a tonne.

The alert follows a potato survey in South Wales two weeks ago that found breaches of labelling laws in a quarter of the shops and stores inspected.

As well as the supermarkets selling Israeli potatoes as British, enforcement officers found Cypriot potatoes sold as British and Italian new potatoes being sold as premium Pembrokeshire produce.

The council raised concerns because at the time of the inspection most of the Pembrokeshire new crop was still in the ground. The survey was prompted by an industry insider who tipped off trading standards officials about mislabelling and sales of poor quality produce at a wholesale market.

A total of 32 stores and shops were inspected. Problems were identified at eight.

Stephen Hay, principal trading standards officer in Cardiff, said: “At this time of the year premium potatoes are just coming on to the market and we wanted to see what was happening. We found foreign potatoes being sold as British, but at this stage it is difficult to say if it is deliberate.

“It could be down to some misunderstanding and stores being lax with labels and notices. But it is certainly an easy way of making a little extra money. We are continuing our investigations.”

He now believes that similiar mis-selling could be taking place across the rest of the country.

Growers fear that consumers could be duped into paying for a prime local potato when it is a lower-value product produced thousands of miles away.

There is a ready market. British consumers like potatoes – only the Portuguese and Irish eat more. The average consumption in Britain is 103kg a year, the equivalent of 500 medium size spuds.

The council confirmed that it was aware of the mislabelling and that it did not endorse the provision of inaccurate information to consumers. It said: “Consumers should know and trust the information given to them. It is important for consumers to buy at the right price and to be given the right information.” It said growers, packers, wholesalers, retailers and caterers each had a role in dealing with contraventions of food labelling and trade descriptions law.

Graham Nichols, potato representative for the National Farmers’ Union, said he hoped that trading standards officers around the country would now stamp out such malpractices.

“If this is happening it is illegal and I hope it is not widespread. Potatoes have to be correctly labelled because we need traceability and to know where a product has come from in case there is a food scare.”

Walter Simon, who grows Pembrokeshire potatoes at his 120-acre farm at Angle, near Pembroke, said: “I am horrified to hear about this. We know there are people under a lot of financial pressure trying to get a quick buck without getting caught. But this is fraud and the consumer is being defrauded because they are not getting what they are expecting.”

Spuds matter

— Britain produces six million tonnes of potatoes a year from 3,000 growers

— 1.4 million tonnes are imported a year

— The total retail value is £1.5 billion, of which £825m is for fresh potatoes

— Fish and chips was the only meal not rationed in the Second World War

— The world’s biggest potato, grown in Germany in 1997, weighed 3.2kg (7lb)

— Louis XVI of France wore potato blossoms in his button hole

Source: British Potato Council, Mintel