• Almost 15,000 seizures of counterfeit merchandise
• The seizures amounted to $260 million in domestic value
• There was a small decline in seizures, which was far smaller than the decline in overall imports
• China was the leading source for counterfeits
• Footwear was the leading commodity seized

(Image from CBP report)
I thought this image from CBP report is most poignant.  Here is the link to 2009 CBP report.

Tony Zafiropoulos

1/31/2010

Tony Zafiropoulos

1/30/2010

The operation, dubbed Operation Storm II, was carried out in eight countries – Cambodia, China, Indonesia, Laos, Myanmar, Singapore, Thailand and Vietnam – between July and November last year under the framework of the World Health Organisation’s International Medical Products Anti-counterfeiting Task Force.

The seized products included antibiotics, anti-malarial and birth control medicines, anti-tetanus serums, aspirin and erectile dysfunction drugs.

Twelve million of them were fake and the best before date of eight million had either lapsed or the medical drugs had been otherwise altered."

Tony Zafiropoulos

1/29/2010

Tony Zafiropoulos

1/28/2010

Tony Zafiropoulos

1/27/2010

The new future products page has the pictures (Tony Zafiropoulos)

 
We have the correct images of the detector and the forensic device.

Tony Zafiropoulos

1/26/2010

"Lab tests showed counterfeit versions of Glaxo's pill Alli contained high levels of sibutramine, Food and Drug Administration officials said.

Sibutramine is the active ingredient in Abbott Laboratories Inc's prescription diet drug Meridia.

"The amount of sibutramine in the counterfeit Alli poses a serious health risk to some individuals," Dr. Janet Woodcock, head of the FDA's drug unit, told reporters on a conference call.

"A person taking the counterfeit Alli as directed would be exposed to twice the maximum prescription dose of sibutramine every day," she said.

The FDA warned earlier this week that sibutramine should not be used by people with a history of cardiovascular disease because it can raise the risk of heart attacks and strokes."

This could be a legal liability for Glaxo, if the company has not had enough work done towards anti-counterfeit methods, or tried to educate its consumers with regards to fake products. (Tony Zafiropoulos)

Tony Zafiropoulos

1/26/2010

"Hindustan Unilever (HUL) has had reports of 118 spurious varieties of their products, Fair and Lovely and Clinic Plus, available in the market. HUL says it has a ‘three-pronged approach’ to address this. It includes, as a spokesperson, from the company puts it: “Creating awareness regarding the problem; engaging with enforcement agencies on implementation and government bodies for changes in laws; and actively taking market action through raids and seizures.”

Tthe bigger the company, the larger is its spurious counterpart. To counter this, some companies have changed the packaging and design of their products at frequent intervals to make it difficult for counterfeiters to duplicate these easily. But, this is expensive, which makes conducting raids the most common pratice of dealing with the menace.

Companies also say most manufacturers of spurious products work in collusion with wholesalers and retailers who stock these, eventually pushing them to unsuspecting consumers, lured by the low price. The discount in price between the original and fake product is said to be 20-25 per cent. So, even as companies try getting manufacturers under their net, the distributor-retailer end is unaddressed. By some accounts, almost 10 per cent of the retail universe in the country is dealing in spurious products.

“Though the law is stringent, its enforcement is weak,” says the legal head of a FMCG company. “There are discretionary powers given to the enforcement authorities, which means perpetrators are generally not penalised too heavily for the crime they commit.”

The article defines FMCG as a Fast Moving Consumer Goods company. It is interesting that in India companies have taken it upon themselves to help the authorities to find counterfeiters. Notice the line that changing packaging designs frequently is expensive. To us it would be obvious to add a non reverse engineer capable authentication marker (Tony Zafiropoulos)

Tony Zafiropoulos

1/25/2010

Ethiopian Review has the story:

"Taipan Enterprises Ltd., based in Arlington, Va., pled guilty Thursday to illegally brokering the sale of arms to Yemen, Chile, Libya and Vietnam without registering and obtaining a license to sell items listed on the United States Munitions List, following an investigation by U.S. Immigration and Customs Enforcement (ICE) and other federal agencies.

Taipan Enterprises was immediately sentenced to pay a $15,000 fine.

According to the statement of facts submitted with the plea agreement, the president and secretary of Taipan Enterprises, Ioannis Papathanassiou, admitted he contacted a number of defense manufacturers to broker United States Munition List items, which included combat armored vehicles, small arms components, night vision equipment, ground radars and other surveillance systems. Papathanassiou admitted that from at least June 2006 he attempted to broker the sale of this equipment to the Chilean military as well as end users in Libya, Vietnam and Yemen."

Because Taipan enterprises was not registered to sell the US munitions list items ICE had a case.  It starts with illegal brokering, counterfeit product selling is not far behind. Not every industry is so tightly controlled. (Tony Zafiropoulos)

Tony Zafiropoulos

1/24/2010

"Ashoor was convicted of purchasing counterfeit Cisco Gigabit Interface Converters from an online vendor in China in an attempt to satisfy a contract he had with the United States Marine Corps in Iraq to deliver genuine Cisco GBICs. Judge Hittner ordered Ashoor taken into custody pending sentencing on April 13, where he faces up to 10 years in prison and a $250,000 fine. 

During this week’s re-trial, the United States presented evidence proving Ashoor, through his company CDS Federal Inc., was awarded a contract in June 2008 to supply 200 Cisco GBICs to the Marine Corps for use in their computer network at the Marine Base in Al Taqaddum, Iraq, located approximately 65 kilometers west of Fallujah.

The language of the contract signed by Ashoor specifically stated the GBICs had to be genuine Cisco products and not an imitation brand that claimed the same specifications. It further cautioned that, “Not only is this a quality issue it is a possible security issue.”

Testimony at trial showed that the computer network for which the GBICs were intended is used by the Marine Corps to transmit troop movements, relay intelligence and maintain the security of the base at Al Taqaddum."

Tony Zafiropoulos

1/23/2010

The new future products page has the pictures (Tony Zafiropoulos)

My apologies, but we have to put up the correct images - should be fixed soon.

Tony Zafiropoulos

1/22/2010

"BB China are BlackBerry imitations, bearing the “Made in China” mark, sold clandestinely in several mobile shops in Dubai and Sharjah at a price ranging from Dh200 to Dh230 per unit. 

They have the same appearance as the original BlackBerry, whose price moves up from Dh1,700 without the SIM card, depending on whether it is a BlackBerry Curve, BlackBerry Bold or BlackBerry Storm. 

Messy, who did not want to give his last name, told Khaleej Times that he has both the original BlackBerry Curve and the “BB China”. 

“Spotting a difference with just one look at it cannot be found,” Messy said. “They look the same until you browse the menu and discover that the BlackBerry Messenger is missing, as it is exclusively for BlackBerry users.”

As in a lot of good counterfeits it is difficult, if not impossible to discern a counterfeit from the real product, unless one has an Authentication Marker.(Tony Zafiropoulos)

Tony Zafiropoulos

1/21/2010

"Cisco is required by law to include technology in its networking products that allows investigators to tap the hardware for information. The fear is that a country like China could sell counterfeit routers containing slightly modified software that would allow hackers to dial into the systems. “That could provide the perfect over-the-shoulder view of everything coming out of a network,” Mr. Moss said.

A Cisco spokesman, Terry Alberstein, said that the company had extensively tested counterfeit Cisco routers. “We have not found a single instance of software or hardware that was modified to make them more vulnerable to security threats,” he said.

Alan Paller, director of research at the SANS Institute, a security education organization, said American technology companies had gotten better about protecting their most prized intellectual property by creating more complex systems for viewing and changing source code. Such systems can keep a detailed account of what tweaks have been made to a software product."

Authenticating Hardware (Our examples page)can show a real versus a fake or hacked chip in Cisco and other networking equipment.(Tony Zafiropoulos)

Tony Zafiropoulos

1/20/2010

{The FDA has issued a warning to consumers about a counterfeit and potentially harmful version of Alli 60 mg capsules (120 count refill kit). Preliminary laboratory tests performed by GlaxoSmithKline, the manufacturer of the FDA approved over-the-counter weight-loss product revealed that the counterfeit version did not contain orlistat, the active ingredient in its product. Instead, the counterfeit product contained the controlled substance sibutramine.

Sibutramine is a drug that should not be used in certain patient populations or without physician oversight.  Sibutramine can also interact in a harmful way with other medications the consumer may be taking.

Consumers began reporting suspected counterfeit Alli to GSK in early December 2009.  GSK has determined that the counterfeit product has been sold over the internet. However, there is no evidence at this time that the counterfeit Alli product has been sold through other channels, such as retail stores.

The counterfeit Alli has:

• Outer cardboard packaging missing a “Lot” code;
• Expiration date that includes the month, day, and year (e.g., 06162010); authentic Alli expiration date includes only the month and year (e.g.,: 05/12);
• Packaging in a plastic bottle that has a slightly taller and wider cap with coarser ribbing than the genuine product;
• Plain foil inner safety seal under the plastic cap without any printed words; the authentic product seal is printed with “SEALED for YOUR PROTECTION”;
• Contains larger capsules with a white powder, instead of small white pellets.

}

The only way to authenticate products without doing laboratory tests is with an authentication marker and reader to authenticate the product.(Tony Zafiropoulos)

Tony Zafiropoulos

1/19/2010

"Thousands of consumers seem to have been collectively duped out of up to £1m by a website that promised designer clothing and footwear at hugely discounted prices.

FocusClothing.co.uk, which took thousands of pre-Christmas orders, closed down in late December, leaving a trail of undelivered goods, and in many cases, unauthorised charges to its customer's credit cards.

Many of those who ordered goods have lost hundreds of pounds, and most buyers have been forced to cancel their credit and debit cards fearing further fraudulent activity.

The case is likely to be first real test of the new National Fraud Authority and should serve as warning to shoppers that they need to do a lot of homework before they hand over their card details to an unknown website."

The United Kingdom has counterfeit sellers in their midst as well.(Tony Zafiropoulos)

Tony Zafiropoulos

1/18/2010

Central & Science has an interesting story on fake drugs:

"We were talking about the fact that nobody knows exactly how many fake drugs are consumed around the world, but it’s pretty clear that the problem is greater in developing countries where there is less funding for regulation and/or policing. (The WHO estimates that markets in industrialized countries such as the U.S. and many parts of the E.U. have no more than about 1% counterfeits. In developing nations, some 10-50% of pills are guesstimated to be bogus.)

“Counterfeiters have killed with impunity,” Newton said. He went on to tell me that people sometimes spend what little money they have to unwittingly buy fakes, and then have succumbed to otherwise curable diseases because the medicines have not worked. “A Burmese patient died a few years ago of malaria having clearly taken fake artesunate,” a malaria drug, Newton said. “When he was admitted with malaria all the signs were that he should recover rapidly but then he deteriorated and died of cerebral malaria very tragically,” Newton added. The man’s community was so upset that people in “the village where the patient came from took all the medicine he had been taking from the shop. They burned it in a bonfire in the village in a spontaneous protest,” Newton told me."

Columbia lab

A concentrated effort by manufacturers and authorities is needed to root out these labs, and a good informational campaign to allow users to quickly see the difference between real and fake product.(Tony Zafiropoulos)

Tony Zafiropoulos 

1/17/2010

"The Semiconductor Industry Association (SIA) today hailed the latest guilty plea in an ongoing prosecution of persons involved in the sale of counterfeit semiconductor products. The U.S. Attorney for the District of Columbia announced Wednesday that the owner of MVP Micro, Inc., has entered a guilty plea to the charge of trafficking in counterfeit goods and faces a sentence of as much as 46 to 57 months incarceration, depending on certain factual issues to be decided by the sentencing court.

“We are very pleased that the U.S. Department of Justice has obtained another guilty plea in the case of MVP Micro, a criminal enterprise trafficking in counterfeit semiconductors,” said SIA President George Scalise. “Semiconductor counterfeiting is fraud, pure and simple. Given the potential for catastrophic injury and damage from failure of a counterfeit microchip, vigorous enforcement actions are necessary to deter this type of illegal activity.

Scalise said that sale of counterfeit semiconductor products poses a special threat to critical infrastructure, health and safety, and homeland and national security. “In this age of constant threats of terrorism, we can ill afford to have the reliability of critical systems put in jeopardy by the use of fake semiconductor devices,” Scalise continued."

We can all hope that all counterfeiters get caught eventually (Tony Zafiropoulos)

Tony Zafiropoulos

1/16/2010

PRWeb.com Story:

"Thinking about buying an Ab Coaster or other popular exercise product for cheap on Craigs List? Think again. The attractive low prices for items seen on internet sites such as Craigs List are there for one simple reason: the product is likely a cheap counterfeit.

The U. S. Customs and Border Protection Service notified The Ab Coaster Company that it seized large container quantities of counterfeit Ab Coaster products at a port in Long Beach, CA. According to company spokesperson, Sean Gagnon: "Everyday we receive phone calls and emails from unhappy customers complaining about problems they are having from poor quality counterfeit goods they purchased on Craigs List or eBay. So we were not surprised when we learned that U.S. officials discovered and seized the counterfeit Ab Coaster products at the port."

Exercise equipment is not immune to counterfeiters attempts (Tony Zafiropoulos)

Tony Zafiropoulos 

1/15/2010

Conference Board Review story:

"More than lost revenue is at stake. Counterfeit brand-name medicines threaten the health of people all over the world, with an estimated 700,000 deaths a year attributed to fake tuberculosis and malaria drugs alone. In Panama, 115 people died after taking cold medicine that contained an ingredient found in antifreeze. In Nigeria, tainted teething medication killed eighty-four children. And in the United States, where the drug supply is considered safe, authorities have uncovered caches of a wide range of fake prescription drugs, including Viagra, Lipitor, and Tamiflu.

It gets scarier. Inspectors have turned up counterfeit parts in nuclear reactors, commercial aircraft, and New York City subway cars, buses, and taxis. In 2008, the Aerospace Industries Association rang the alarm bell, calling for standards to prevent counterfeit replacement parts from winding up in space and defense systems.

International Chamber of Commerce’s Counterfeiting Intelligence Bureau estimates that fakes account for 5 to 7 percent of international trade, or about $600 billion annually. While some observers dispute this estimate, it’s hard to argue with U.S. Customs and Border Protection, which says it seized more than $270 million in counterfeit and pirated goods in fiscal 2008 (ending in September), up 38 percent from the prior year and nearly three times the value of goods seized in 2003. China, predictably, was the top source of bogus products."

The problem is crime prevention is not the only strategy companies have to take, they must create a strategy of authenticating their products, using covert and overt means - the covert angle we can help with our custom designed authentication marker. (Tony Zafiropoulos)

Tony Zafiropoulos 

1/14/2010

Bangkok Post story: