Mainland China’s food safety watchdog has backtracked on its endorsement of baby milk powder exposed as fake, saying its earlier approval was aimed at preventing a panic. The case has also sparked questions from the public and media about why the government withheld information about the fake products for months after suspects were arrested. About 17,000 cans of formula sold in several provinces have been traced to a syndicate that took cheap milk powder or product with defective packaging and sold it under multiple brand names, some of them top-sellers. Why countries such as China pay price in lives for baby formula dependence Shanghai police began investigating the syndicate in September and arrested six people in January. But the public only learned of the fake formula on March 22, when the Procuratorate Daily , the mouthpiece of the national prosecutor’s office, revealed details of the case. On Monday, the China Food and Drug Administration said the products seized by the police had passed its quality tests and met national standards. It said the formula did not pose a health risk. Among the companies whose products were counterfeited by the syndicate were global brand Abbott and leading domestic seller Beingmate. After its initial statement drew a massive public outcry, however, the watchdog said on Wednesday that its initial response was aimed at reminding consumers “not to panic” if they had bought the products. China’s government orders inquiry into sale of counterfeit baby milk formula But producing or selling counterfeit milk powder violates both commercial fraud and intellectual rights laws. The state authority said consumers could seek compensation from retailers. Food safety authorities in seven mainland provinces and municipalities are, under the order of the State Council, trying to trace the fake formula. Public confidence in infant formula has been shaky since 2008 when 300,000 babies across the mainland were found to have suffered kidney damage after having consumed melamine-tainted milk powder. Six infants died. Shanghai arrests six people over 17,000 tins of counterfeit baby formula More recently, a mother and daughter in Shandong province were arrested for running a massive network that distributed expired or improperly stored vaccines across the country for five years. The scandal involved vaccines valued at some 570 million yuan (HK$683 million). “It is not difficult to gain public trust ... if the [diary] industry builds up its credibility and [the authorities] disseminate information in a timely and complete manner,” said a commentary in The Beijing News . “But with little information available for the public ... telling them ‘not to panic’ could lead people think the other way.” China’s new baby milk scandal to trigger tighter cross-border e-commerce rules Since the fake-formula scandal broke, sales of Abbott and Beingmate milk products had dropped significantly in supermarkets in Chengdu in southwest Sichuan province, according to the Sichuan Daily . Abbott said it spotted counterfeit milk powder under its brand last year and alerted the police. The first suspects were apprehended in December and the formula was seized by the authorities, the company said on its Weibo account.