Whether fake Ferraris or sham aspirin, it's important not to lose sight of counterfeiting's true victims

March 8, 2010 15:50 by Robert Johnson

At the fifth annual Harper’s Bazaar Anticounterfeiting Summit in May 2009, attendees were abuzz about a particular item parked outside the Hearst Tower. Roped off and resting on a green carpet on 8th Avenue was a dazzling piece of automotive craftsmanship: a 1967 Ferrari P4.

Finished in that famous shade of red, the car was the vision of a true artisan, the perfect blend of engineering and elegance. It was the kind of vehicle you imagine cutting corners along the Amalfi Coast or snaking along the roads of the Tuscan countryside.

As it’s rumored that only one completely original version of the car still exists, it was a rare experience for car buffs and casual observers strolling between 56th and 57th streets. But because this beauty was part of the Anticounterfeiting Summit, where everyone attending was committed to ending the sale of fake goods, the auto had to be flawed in some way.

There were comments about the hubcaps and the windscreen being counterfeit. The more refined eyes were able to detect a pair of phony wipers and sham taillights, but identified by themselves, these components only represented a fraction of a larger problem - the entire vehicle was fake. From the steering wheel to the tailpipe, there wasn’t an authentic piece of Ferrari engineering in the car.

When you think about what it took to build the fraud-o-mobile, it's both striking and depressing.  The project required a huge amount of time and effort, but it wasn't the kind of sacrifice that should be admired or rewarded.

It isn’t flattery. It’s forgery. It’s the difference between a healthy relationship and a parasitic one. 

As the Faux-rari shows us, counterfeiting continues to seep into every nook of the marketplace, including the realms we thought were too complicated to fake. By pushing their wares, the sham peddlers drain the life force of authentic craftspeople. They are able to do so not only because they are motivated and sinister, but because of the large appetite for cheap versions of coveted brands.

If we increase our understanding of the counterfeiting epidemic, we can reduce the appetite for sham goods. No matter how innocent it may seem, buying a fake just isn’t an option when you understand what’s required to produce it. 

Don’t confuse the end product with what’s truly at stake. It’s an easy misstep to rank the dangers of certain counterfeit goods. While a bogus handbag might not seem as big a deal as a fake pill that contains none of its advertised active ingredients, we need to remember that this only considers the consumer's point of view.

What about those who are truly abused by counterfeiting: humans forced to work in despicable conditions and children sold into these jobs who are later mangled by faulty machinery or broken by neglect?

We need to reorient ourselves. Let's think less about what purchasing a fake does for us and, instead, consider the people hurt by these purchases. The consequences are bigger than a passing desire to find cheaper versions of things we love.

When human rights and creative vision are threatened, the stakes are just too high to obscure what's really at stake. 

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The FANIF Q&A with Christine LaCroix, Managing Director of the Plagiarius Consultancy

February 11, 2010 09:01 by Robert Johnson

Aktion Plagiarius was founded in 1977 by Professor Rido Busse after the German industrial designer discovered an imitation of one of his designs on sale at a trade fair in Frankfurt for a price that severely undercut his own.

Busse desperately sought legal recourse, but when he found the German government of the late 1970s did not sufficiently protect the originators of consumer goods, he decided that the best way to punish the imitators was to draw negative publicity to their actions. Busse designed a statue of a gnome with a golden nose as his anti-award, a play on the German saying “to earn oneself a gold nose” (or to earn much money), and created an award ceremony to “name and shame” the pirates. Roughly 30 years later, what began as an award ceremony has grown into a full-blown anti-counterfeiting consultancy.

As the organization’s managing director, Christine LaCroix oversees strategic development as well as day-to-day operations. On a given day she might be sitting at her desk counseling a company that has been the victim of plagiarism, writing an article about recent discoveries of counterfeiting, or curating over 350 examples of piracy that are housed in the museum. Another day will find her driving with the museum’s traveling exhibition to a trade show, where she will speak about fair business practice or how to fight the problem of product plagiarism.

Since she began in 2001, no two days have been the same for LaCroix, but the fight against counterfeiting is something she believes in so strongly that she is tireless in her search to find dynamic ways to get the message across to the world.

How can we continue to educate the public about the problem of counterfeiting?

We need politicians, trade associations and corporate groups to act in concert.  In order to successfully fight this problem, we have to increase consumer awareness. Everyone understands the theft of property is a crime, but, intellectual property theft is too abstract for most people to understand. To explain how damaging it can be, we must make it understandable by showing it in publications, TV reports, stories, events, and seminars.

We know that a picture is worth a thousand words and the public needs to be educated with as many of these real examples as possible. They need to know about child labor, poor manufacturing conditions, long hours, neglect for safety and hygiene, and the lack of protection for factory workers against dangerous machinery and noxious chemical substances. Consumers have to understand that organized crime is heavily involved in the business of fakes. They must know that they are supporting illegal activities by buying fake products. We need to further publicize the dangers of the inferior quality of the fakes and plagiarisms—dangers that are not often visible at first sight.

What is the real cost of fakes to society?

Especially in economic hard times, when consumers are more likely to focus on price, they may be unwittingly drawn to cheap imitations that fit their budgets. However, the imitators are not concerned with quality, safety or ecology. They knowingly put the consumers’ health and lives at stake. It can be very dangerous.

Manufacturers invest in Research & Development. They invest in design and in quality controls. They do this so they can launch innovative and safe products. But to do so, they must make huge investments. But because of the abundance of cheap fakes and plagiarisms, more and more companies’ ability to recoup this money is affected and they, along with their employees, suffer. Good brand reputations are destroyed, and unfounded product liability claims are made. Jobs are lost. Piracy affects everyone.

How has counterfeiting evolved?

Counterfeiting has always existed, but it has grown enormously with globalization and the Internet. In the 1970s and 80s, counterfeiters focused on luxury products, but the trashy quality of the knockoffs was clear. Back then the majority of the counterfeiting occurred in Taiwan, China, and Korea. Nowadays, when we consider the whole production chain of a counterfeit good, from awarding of a contract through its manufacture up to the end customer, it is clear that this is a global problem. It is not isolated to a specific region.

Official organizations estimate that plagiarisms and fakes cause worldwide losses of several hundred billion Euros and several hundred thousand jobs each year. This number continues to grow. The explosion of technology accelerates this growth, namely the anonymous distribution channels on the web.

As the criminal know-how and experience increases and technology continues to make it easier to produce high quality fakes in large numbers, the number of victims will also expand.

What was once a “cottage industry” has developed into a highly sophisticated international network of manufacture, logistics and distribution.

Is counterfeiting more dangerous than it has been?

Definitely. The problem is bigger than ever. Counterfeit pharmaceuticals that contain none, too little, or too much of the active ingredients have entered the market. We have seen electronic devices sold without safety and quality controls that present the danger of short-circuiting, combustion and explosion. Poor manufacturing conditions have led to bacteria found in fake perfumes.

How do we improve penalties and enforcement?

In theory, the intellectual property laws and regulations of countries like the U.S. and Europe, and also those of many other countries, are quite good. However, the fines and penalties imposed on imitators are far too low and do not deter them. As long as the counterfeiters’ profit margins are similar to drug dealers while the penalties are much lower, the product pirates will expand their businesses. Enormous penalties are essential if we want to stop this. 

What are the biggest areas of counterfeit growth?

We have seen growth in the pharmaceutical, cosmetic, food and beverage, electronic and clothing sectors. Some of the scariest growth happens in more of the day-to-day products like machine parts, vacuum pumps, pressure gauges, pneumatic devices and spare parts, among others.

Where have you seen the greatest success in your efforts?

Our major goals are the increased awareness of the public, protection of innovative companies, and the prevention of imitators.

We have received positive feedback from entrepreneurs as well as consumers for our exhibitions (museum and traveling exhibitions) as well as our lectures. People are often grateful for the information and the “first-hand-view” on counterfeiting and its impacts.

We are in close contact with justice ministries and other organizations to help expand the enforcement of the intellectual property laws. In the late 80s, we contributed to the improvement of the design patent law and the introduction of a law against product piracy that includes the possibility not only to prosecute the manufacturers of imitations but also the retailers and distributors.

Our Plagiarius awards aim to deter imitators through public exposure, or “name and shame.” Western companies are highly concerned about their reputation and the significant media coverage of the negative award can make an impact. Numerous imitators have brokered a mutual agreement with the original producers before or shortly after the Plagiarius Award Ceremony, for example they have withdrawn remainders of stock from the market, have signed forbearance declarations and/or revealed their suppliers.

 
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How to fight the fake trade with limited resources? The Milwaukee Police Department and Nike may have an answer.

February 3, 2010 14:38 by Robert Johnson

When the topic of counterfeiting is brought up in law enforcement offices across the country and around the world, one of the first questions that senior staff has to ask is whether or not they have the resources to fight the problem.

In a cheerless economy, the effort to find funding for the fight against fakes is like sending a pig out to hunt truffles in the forest with its snoot stuffed full of fabric softener sheets that were dipped in gasoline.

In this environment, you have to be smart about your resources.

What's the better choice, do you go after the big takedowns of the distribution operations that grab headlines or do you arrest the local counterfeit vendors? A case can be made for either one. Knocking around the small vendors disrupts the money flow to the sham overlords, and the bigger busts can discourage the entire counterfeit industry.

Either way, without the funds to pursue the full spectrum of enforcement, it's not easy to know the best course of action. But, just as the criminals are innovative, enforcement efforts are evolving too.

recent joint effort by Nike and the Milwaukee, WI police force may have given us a workable solution.

Working together in an ongoing operation, the police department and federal agents have been performing controlled buys of fake Nike goods from local merchants using marked bills and confidential informants. Their efforts have produced several arrests and seizures . 

With annual revenues of around $19 billion, you have to wonder why Nike would get involved in a smaller campaign in the first place. Is this the best uses of scarce resources?

Two factors motivated the effort. First off, Nike’s trademark is held in Wisconsin. Secondly, despite the relatively small seizures, the sale price of the fakes and a pair of legitimate sneakers (around $40 for the fakes and $120 for the real version) is close enough that a customer who could afford the real version might go with the forgeries instead. Someone who buys a faux Louis Vuitton wouldn't necessarily pay ten times the price of a fake for the real deal.

The operation is a fine example of how law enforcement and a trademark holder can work together in the fight against fakes. And while the results might seem miniscule in the face of a $200 billion dollar counterfeit industry, this shared initiative represents two of the three prongs needed to defeat the epidemic: (i.) savvy law enforcement and (ii.) a brand committed to protecting its interests.

You, the educated citizen, are the third prong. You understand the real cost of fakes. Gail Montenegro, a spokeswoman for U.S. ICE, was quoted in the article as saying “the victims [of counterfeiting] are American businesses, trademark holders and people who make and distribute the authentic products," was on the right track, but only got it partially right.

Never forget that the victims are not only the trademark holders, but real people whose lives are ruined by forced labor and abuse.

The problem is bigger than revenue and line items. It’s about basic human rights.

That said, we encourage you to become a passionate member of the third prong. Spread the word and join the fight.

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New "Faux Fragrances Are Never In Fashion" Ads

January 26, 2010 20:46 by Robert Johnson

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Burberry wins a significant anti-counterfeiting lawsuit

January 24, 2010 20:12 by Robert Johnson

“Justice cannot be for one side alone, but must be for both.” – Eleanor Roosevelt 

Ms. Roosevelt’s suggestion is undeniably eloquent, but at first pass it may seem a bit off.  When we hear the word “justice,” it’s natural to think of a two-sided equation: Party A, who has been wronged, demands that justice be served, while Party B, the toe-stepping group, does their darnedest to avoid being served. So while justice, in both concept and practice, balances the scale, it seems that it does so by only benefitting Party A.  

The upside of the justice system is obvious. But while it helps compensate for and defend against damages–pay for your crimes with cash, time, or both–it seems like the slighted are the only ones who experience the upside. So how can it “be for both” then?  

The latest example of anti-counterfeiting justice occurred this past Tuesday, January 19th when U.S. District Court Judge Paul Crotty found a New York-based importer and online dealer guilty of peddling sham goods and awarded Burberry $1.5 million in damages.  

In 2005, Designer Imports, Inc. entered into an agreement with Burberry not to sell counterfeit goods on its site. Two years later, Burberry sued the company after discovering fake versions of its products for sale on the same site. Burberry’s investigators found what they claimed were 14 examples of phony goods.

Five years later, the presiding judge agreed that 12 of the items were counterfeit and penalized the offending company. At $100,000 per violation plus attorneys’ fees, Designer Imports, Inc. has been ordered to pay Burberry $1.5 million, though the brand had originally sought $6.5 million. And while the settlement bars the offender from selling any more faux goods, the company is allowed to continue selling legit items on its site.  

When we consider this recent example, Ms. Roosevelt’s meaning becomes a bit clearer.  It may be quickly summed as ‘justice in, justice out.’ She was referring to fair punishment. 

The process which penalizes the peddlers of counterfeit goods is designed to correct a specific wrong and to set things right again, but it can not exceed its mandate by delivering an unjust sentence.  Burberry received 23% of its original request and Designer Imports was allowed to remain open, but was there justice on both sides of the equation? Was the punishment fair? 

We certainly think so and congratulate Burberry and their diligent inspectors for ensuring that the counterfeiters know what lies in store for them.  Ms. Roosevelt’s statement is clearer for their efforts.  

We hope that future justices keep in mind that these cases are about something bigger than dollar amounts - lives brutalized by the production process of bogus goods cannot be quantified.

We do not ask that the two-sided type of justice advocated by Ms. Roosevelt be denied in the cases of criminals punished for these abuses, but we do demand that those responsible for punishing them always keep the big picture in mind.

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If sweat were patented, countefeiters would fill buckets with their own trying to violate it

January 18, 2010 13:40 by Robert Johnson

It is exercise alone that supports the spirits, and keeps the mind in vigor. —Cicero

Lack of activity destroys the good condition of every human being, while movement and methodical physical exercise save it and preserve it.  —Plato

It’s early in the new year, so there's a high likelihood that your resolution to exercise more is intact, but if you’re anything like us, historically these vows have had the shelf life of an un-watered orchid.

Most of our day would be put to better use exercising, unless you're an emergency room doctor or crossing guard. Exercise is a truly wonderful thing and though, like us, you may not engage in it as often as you’d like, we all know the value of a good sweat.

Sweat is a particularly odd currency, when you think about it. It signifies effort and resolve, commitment and sacrifice, tenacity and perspective. It’s one of those unique things like hard work and baking – the latter shows our hand as far as our new year’s resolutions are concerned - that is a reward in itself.

Sweat means you care enough about something to fight your own limitations for it.

So, that said, we’re either ready to go for a jog or throw in a copy of Rudy.

Advertisers are aware of the motivating power of sweat. They know it sells. Can you think of a commercial for a sports drink or a new shoe line where the volume of the little bulbs of sweat peeling off athletes isn't identical to the water off a sheep dog that has recently come out of a lake?

Here’s what the advertisers know: hard work is inspiring and contagious. That kind of commitment deserves our admiration and if we happen to buy a pair of shorts and pick up an energy bar along the way, so be it. But any effort so unbridled demands that we acknowledge it and, in the best of situations, we might even mimic it.

That said, we just put Rudy on pause and jogged over to the closet that's become a graveyard for our infomercial peddled exercise equipment and grabbed the nearest dusty item that, were it not for the fluorescent plastic, looks like it belongs in a medieval dungeon.

The only thing about this ‘sweat sells’ knowledge is that the counterfeiters are aware of it too. In fact, all they require to throw together some sort of sham version of a legitimate item is that it fits in the aforesaid phrase: “______ sells.” If it sells, it's going to be counterfeited, and if it is counterfeited, there are dangers that follow. And while they can’t counterfeit sweat, they can copy the items designed to stimulate its production, like the large quantity of fake exercise equipment – the Ab Coaster - recently seized by U.S. Customs in Long Beach, CA.

Customs is cautioning would be consumers to be wary of purchases made on Craigs List and online. Fake exercise equipment can lead to serious injury because the construction and the materials are of a lesser quality – they may work the wrong muscles and in the wrong way. And be wary of the stories that sellers may provided to give the fake item a hint of authenticity. The only way you’re sure to get a legitimate product is to buy from the manufacturer or a licensed dealer.

Make an informed purchase. And with all this talk of sweat, let's not lose sight of how those exploited by the counterfeiters toil in miserable conditions to produce the fakery.

We won’t tire of this fight. We’ll expend ourselves to win it. and we encourage you to do the same.

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What might David Ogilvy say about the counterfeiters advertising on Google?

January 10, 2010 20:49 by Robert Johnson

“Advertising is only evil when it advertises evil things.” – David Ogilvy. 

As the influential author of several books and the subject of many others, Ogilvy, who was responsible for the memorable campaigns of many large brands, including American Express and Rolls Royce, was for decades considered one of the industry’s top pens.   

It seems inevitable that an advertising professional looking back on his or her career would see a sizable pile of witticisms, a great heap of realized and discarded sayings, but Ogilvy not only saw a veritable mountain range of clever world play aimed at moving products in his rearview, many of his most memorable musings had a moral message.*  

Ogilvy felt a copywriter ought to believe in a product before he or she sold it. He was famous for suggesting that if either you or a member of your family wouldn’t use a certain product, then you had no business endorsing it.  

So when faced with the recent criticism of Google for taking profits from advertisers who peddle counterfeit goods, what is a most clever advertising professional to do? 

A recent Times article states that “thousands of Britons are being duped into buying goods that are fake or simply never arrive, as well as putting their credit or debit card details at risk of fraud.” 

We know for certain that there is nothing good in the exploitation of innocents for the profit of a few. This is what counterfeiting requires. We’ve detailed the human rights abuses that occur in the production process. We know that counterfeiting is often used to finance terrorism and other forms of illegal trafficking.  So while we commend Google’s official policy that prohibits any advertising on behalf of websites that sell counterfeit goods, we believe the practice needs to be tightened. 

If Google discovers a site slinging sham goods, a company spokesperson maintains that the site will be taken down immediately. Further, the company has security measures to prevent the advertisement from reappearing. This is certainly good, but when you consider the number of advertisers Google hosts, it is an admittedly difficult thing to monitor.  

Though it may be difficult, it is not impossible. 

We encourage Google to ramp up its security measures and to police dubious sites more frequently. An effective way to do so might be to monitor the original price set by the legitimate manufacturers and search for severe discounting.  

We are the last to bemoan a good sale, just as long as it’s legal.   

Remember, the responsibility does not fall on Google alone. As consumers, we all bear some, as does the name brand. We must work together to defend the art of luxury products and those that are exploited by the production of counterfeits. End the ignorance and by doing so, empower others. 

This brings to mind another Ogilvy gem.  “I prefer the discipline of knowledge to the anarchy of ignorance.” 

So do we. Help us end the ignorance surrounding the fake trade.  

*We can’t confirm whether or not Ogilvy cared for alliteration, but you know how we feel.

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New study finds that counterfeits may not affect the brands they imitate, but loses sight of the larger problem

December 2, 2009 21:10 by Robert Johnson

While it seemed as clear as a Van Cleef gemstone that the motivation for buying luxury items was their artistry and quality, a professor at MIT has written a recent paper which uses counterfeit goods to reconsider these impulses.

In “Rethinking Brand Contamination,” Renee Gosline weighs the basic desire to own a high-quality item against a sociological theory known as “conspicuous consumption,” a 19th century concept developed by Thorstein Veblen that suggests buyers are motivated to mark their social status with certain goods.

Pay for play. Keeping up with the ever-fashionable Joneses. Call it what you will, but the skinny of Veblen’s theory is we buy things to associate with certain groups and distinguish ourselves from others.

By considering both forces, Gosline’s goal was to determine how consumers assess luxury brands. In her study, she showed subjects two sets of pictures that depicted either authentic luxury or fake luxury. The first collection showed stationary handbags, sitting alone on a shelf, while the second collection captured the bags held by a person in public. Her study measured both the confidence of the subjects in determining whether the item they saw was bona fide and how much they were willing to pay for it.

When consumers observed the first group they were less confident about their ability to judge the authenticity of an item and weren’t willing to pay top dollar for it. With the second group of photos, where the items were shown in a social setting, the same group felt more secure and was willing to pay more.

Gosline, who teaches at the Sloan School of Management, concluded the subjects were more confident because they were matching the objects with their preconceived notions of who would own it.

“Basically these consumers look at the person, the setting, and determine the authenticity by seeing if the person’s image corresponds with the image they have of the brand,” Gosline said.

The research suggests a dual motivation for buying luxury products and may indicate, as the press release states, that for luxury firms looking to expand brand cachet, quality alone may not be enough.

But let us not forget that concern for brand durability, quite frankly, is, at best, in issue secondary to the abuse of human rights that occurs in the production of sham products.

Additionally, in the midst of all the research and hypothesizing, it’s easy to lose sight of the origins of luxury. It all began in early 19th century ateliers with a profound desire to make high-quality goods. Sure, the industry has evolved, but it seems that the basic motivation to own a piece of finery remains the same. Though, others might say that lacking the staggeringly complex human psyche, of which Veblen’s theory may be a part, we wouldn’t have this art or this desire to begin with. Gosline manages a fine study of this.

It’s become a question of what came first: the Lalique chicken or the Faberge egg.

So, while we appreciate Ms. Gosline’s rigorous research and commend her for further illustrating the nuanced nature of human motive, we suggest that her next consideration  never loses sight of the larger concern: humanity.

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The FANIF Q&A with Inspector Brian O’Neill, Commanding Officer of the Organized Crime Investigation Division

November 30, 2009 23:10 by Robert Johnson

Inspector Brian O’Neill stands on the front line of the fight against the fakes. As the Commanding Officer ofthe NYPD’s Organized Crime Investigation Unit, a post that he has held for 7 years, he directs the city’s anticounterfeiting efforts. A Bronx native and graduate of Cardinal Spellman High School, Inspector O’Neill began his police career in 1980 as a patrolman out of the 48th Precinct in Tremont.

Since his early days in narcotics, O'Neill has earned a steady stream of promotions: Sergeant (1985), Lieutenant (1989), Captain (1994), Deputy Inspector(2003). He was promoted to his current post of Inspector in 2007.  As commanding officer of the OCIU, he is responsiblefor the day-to-day operations of the department’s fight against the fake trade, as well as shaping future investigative and enforcement programs. He has helped grow a division that was called the ‘t-shirt squad’ when it was formed in 1994, the first police unit of its kind in the country, into a dynamic crime fighting unit tasked with defending against an ever-morphing epidemic that costs the city a billion dollars each year.

Let’s talk about education, what do you believe we can do in this area?

We have to keep getting the word out.  The profit made from counterfeiting is funding organized criminal groups, and that is bad for everyone. Terrorist groups are the beneficiaries of this money. Child labor continues to be exploited by counterfeiters. This is a significant issue. When you combine these facts with the economic impact counterfeiting has on the city, the NY comptroller has said in the past that the city loses $1 billion a year, which is a staggering number. The importance of the problem is undeniable. We have to tell people about it.

Getting the word out to the consumers who buy fakes, by whatever means necessary, is one of the best ways to fight the counterfeiters. The people who are buying these items need to hear about the reality of their purchase.

What is the real cost of fakes to society?

It funds criminal organizations. It pays for terrorist groups.  Tax dollars that could be put to other social programs are spent in the fight. The cost is huge.

How can we increase the visibility of this epidemic?

Corporations need to discuss it more within themselves and with the public. Increased advertising that addresses the problem would also help.

By making government reports that document the problem more visible, like the comptroller’s report, we can educate the public about the size of this problem. When public figures like Ray Kelly, NYC's Police commisioner and Mayor Bloomberg have spoken, it helps significantly.

How has counterfeiting evolved?

It is constantly evolving. Back in 1994, when the NYPD realized the economic impact this crime could have on the city, we saw that it was growing and had to confront it. The first unit that was assembled to tackle the problem was focused exclusively on trademark infringement. It was nicknamed the ‘t-shirt squad,’ because the emblems, like the Nike swoosh, were being printed, slapped on t-shirts, and sold illegally.

Now, virtually everything is counterfeited: shoes, belts, bags, electronics, auto parts, etc. Auto parts are scary when you think about brake pads. We’ve seen fake Bluetooth devices. Then there are the fake batteries. What happens when they end up in a fire detector?

The way we’ve addressed the problem has changed over time: we started with one unit and now we’ve brought many more into the fight. We have intelligence officers who notify us of counterfeit sales. We use asset forfeiture laws to go after companies that sell. We’ve really expanded.

Even the industry helps by training patrol officers to recognize the false items sold by peddlers.

We have to address all levels from individual street sellers to large-scale distributors, but we want to stay focused on the big outfits: the importers and the manufacturers. 

Is counterfeiting more dangerous then it has been?

We have never seen so many items being counterfeited, and they can all be potentially dangerous to everyday life. It's amazing. Like in most criminal enterprises, if these people put their minds to good purposes, the results would be equally significant. They just chose the wrong path.

How do we improve penalties and enforcement?

We need to make law enforcement, prosecutors, and judges recognize the impact these crimes have, so that they are treated in a proper manner. Again, awareness is the key.

What are the biggest areas of counterfeit growth?

Handbags are always big. And, as an example of intellectual property pirating, we’ve always seen a lot of growth in reproduced DVDs.

Where have you seen the greatest success in enforcement?

We’ve done more seizures with clothing items than in any other area. There was one seizure that netted 19 tractor trailers of fake clothing. Success can also be measured in the police department’s role as a deterrent. We made a sizable seizure of auto parts and made some arrests and since that one incident, we haven’t seen any others like it. Word got out.

How do we need to adjust our message to meet the evolving problem?

It’s the same message, but I think we need to adjust the volume: everybody has to be aware of what they are buying and from whom. They need to be more cognizant of the products they purchase and the effects of buying fakes. 


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Purveyors of 'fake pharma' are punished by an international coalition

November 20, 2009 23:05 by Robert Johnson

The counterfeit pharmaceutical industry was just slipped a mickey, care of the international law enforcement community.

It was banner week for a global coalition combating the sale of sham pharmaceuticals on the Internet. A group of agencies from 24 countries came together for five days in “Operation Pangea II,” an effort to curb web sales of counterfeit and illicit medicines that resulted in several arrests and the seizure of thousands of harmful products.

The weeklong operation, which began on November 16th, dismantled 72 websites, confiscated 167,000 illicit and counterfeit pills, and left 22 individuals under investigation in its wake, according to an Immigration and Customs Enforcement (ICE) press release.

The domestic team was a veritable acronym stew of U.S. organizations, an alphabet-agency soup, with contributions from the FDA, the DEA, ICE, USPIS (Postal Inspection Service), and the CBP (Customs and Border Protection).

On the international side, under the larger umbrella of INTERPOL and the World Health Organization’s (WHO) nimbly-titled International Medical Products Anti-Counterfeiting Taskforce (IMPACT, inviting the question: what comes first the underlying org or the clever acronym), law enforcement agencies kicked down firewalls and crammed flash bangs into the inboxes of suspected peddlers.

The effort targeted the channels of sale and distribution for black market digital pill pushing. The week began with a group web surf, trolling for dodgy sites that sold the bitter pills, and identified 751 separate locations that were engaged in illegal activity. The USPIS and the Universal Postal Union  (UPU) shook the contents of more than16,000 packages and turned up thousands of antibiotics, steroids, diet pills, lifestyle drugs – those that treat baldness, ED, wrinkles or acne - and others.

"Consumers seeking a better price or wanting to buy drugs without a prescription often do not know that the drugs they order through the Internet are often manufactured in inferior facilities, with substandard or dangerous ingredients, and with a high likelihood that they will not perform as expected, or worse, will cause harm," said John Morton, Department of Homeland Security Assistant Secretary for ICE.

Put a tad more bluntly: when you hustle around dodgy sites looking for cheap deals, you most certainly get what you pay for.

Odds are the bunk pills on these sites weren’t manufactured in the most rigorously sterile of settings. The mixing flasks likely carried a little less, if any, of the active ingredient you had hoped to get, or in the worst possible scenario, that you needed. The Petri dishes were caked with a little grime, and though a little fungus may have worked for Alexander Fleming and his discoveryof penicillin, in the remaining history of positive medical developments, the presence of mold isn’t such a good thing.  

In the murk of the digital world, it’s easy to behave like deep-sea creatures snapping at the brightest stimuli. Flashy banner ads touting the lowest possible prices for prescription pills make it easy to lose sight of the nefarious nature of a transaction that, were it to occur in the brick and mortar realm, would involve crumpled brown bags passed in still running cars while both parties glance over their shoulders.

Operation Pangea II is an exemplar for future efforts to fight the fake trade. And while multi-pronged, cooperative initiatives yield fantastic results, those with the greatest power to wipe out this epidemic are the would-be purchasers.  

Swim to the surface and buy responsibly.

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