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Glossary
Colgate has found counterfeit toothpaste at some dollar-type discount stores
Dentistryiq.com story:

{Colgate-Palmolive announced June 15 additional developments and actions by the company to protect consumers against possible risk from recently reported counterfeit toothpaste. The company yesterday warned consumers that the counterfeit toothpaste, which has been found in some small, independent dollar-type discount stores, may not contain fluoride and could contain diethylene glycol, an ingredient not used in Colgate toothpaste anywhere in the world.

The additional developments and actions taken by the company include:

• Colgate is contacting all its accounts handling Colgate toothpaste in the United States to ensure that they have no counterfeit products. At this time, none have reported counterfeit products. If any accounts were to identify suspected counterfeit products, the company would remove it from the shelf.
• The company is in the process of picking up suspected counterfeit products in the small, independent dollar-type discount stores in the four states where it has reportedly been distributed. Results of these efforts will be provided to the U.S. Food and Drug Administration.}

The FDA spokesman says that the low traces of diethylene glycol are not harmful but they should not be there. Colgate is doing the right thing by publicising what they know. But it would have been better to not allow any counterfeit products to come into the supply chain at all.(Tony Zafiropoulos)

07/31/2010
Fake Viagra sold in Winnipeg, Canada store Marche Euromix
Winnipegfreepress.com story:

{Health Canada says it worked with the Canadian licensee Pfizer Canada to confirm the product was not Viagra, a prescription drug used to treat erectile dysfunction.

The store, Marche Euromix, says it is no longer selling the unauthorized product.

Health Canada says it inspected the store in response to a complaint by a consumer.

The health agency says unauthorized and counterfeit health products can pose serious risks to health as they haven't been reviewed for safety, quality or efficacy.

It says counterfeit products may contain ingredients not listed on the label, dangerous additives and microbial contamination.

In addition they may lack the active ingredients that purchasers might expect them to contain.}


It behooves companies to have some kind of system in place so as to remove counterfeit products before they hit the store shelves. An anti-counterfeit technology like an Authentication Marker with a Detection system placed in the Manufacturer supply chain would weed out the counterfeit products.(Tony Zafiropoulos)

07/30/2010
24 fake handbags land a Texas Alcohol & Beverage Commission officer in jail
kfoxtv.com story:

{On Tuesday, special agents seized Salazar’s 2006 yellow H3 Hummer after 24 suspected counterfeit handbags bearing the Coach and Dooney & Bourke trademarks.Salazar was released from the El Paso County jail Thursday on $5,000 bond. His arraignment is set for July 29.If convicted, Salazar faces a maximum penalty of 60 years in federal prison and a $10 million fine.Federal court records don't list an attorney for Salazar, who couldn't be reached for comment.}
Sometimes only a few handbags can land you in some hot water.(Tony Zafiropoulos)

07/29/2010
US House committee learns auto industry loses $3bil in lost sales/yr
tmcnet.com story:

{Mansfield said, "Counterfeit parts and components for cars, trucks, buses and commercial vehicles pose a critical problem to the American economy and the supplier industry because of the wide range of counterfeit products manufactured and trafficked worldwide. In the past, MEMA has estimated that counterfeit goods cost motor vehicle suppliers at least $3 billion in the United States and $12 billion globally in lost sales. Please note that the industry believes these numbers are conservative. In fact, Frost and Sullivan estimated in 2006 that the global losses to motor vehicle suppliers due to counterfeiting would be as high as $45 billion in 2011.}

Imagine a world where the criminal element cannot counterfeit your product (with a proper Authentication marker and Detector). Together this system is unbreakable. Due to NDA disclosure requirements we cannot discuss the intricate details as to how and why this is the case.  Please contact us if you want to re-capture some of your market share lost due to counterfeit products.(Tony Zafiropoulos)

07/28/2010
Hong Kong found 291 bags of counterfeit MSG
7thspace.com story:

{Hong Kong Customs officers detected a workshop engaged in counterfeit gourmet seasoning - Monosodium glutamate (MSG) manufacturing on July 24. In the operation, the manufacturing workshop in Lok Ma Chau was smashed and two foodstuff wholesale shops in Western District were searched. Customs officers seized 291 bags of suspected counterfeit MSG worth about $28,000 and 1,123 bags of raw materials and manufacturing equipment worth about $116,000.}
Nothing seems to be off-limits as far as counterfeiting goes. This is not a large bust, but I thought it was interesting that even MSG is counterfeited.  So there really is no limit to counterfeit goods.(Tony Zafiropoulos)

07/27/2010
Saudi Arabia and Yemen cooperate against counterfeits, as Saudi Arabia loses $10.9 Billion annually
Zawya.com story:

{The Kingdom is to sign a memorandum of understanding (MoU) with Yemen for cooperation to protect consumer interests in the two countries.

The decision was taken at a joint meeting held on Saturday in Jeddah between the consumer protection organizations of Yemen and Saudi Arabia.


Counterfeit products and services are rampant in Saudi Arabia. As a result, Saudi companies as well as consumers suffer heavy losses. According to one expert at the Jeddah Chamber of Commerce and Industry, Saudi companies incur losses of nearly SR50 billion annually as a result of fraudulent trade practices.


A recent survey confirmed that Saudi Arabia loses more than SR41 billion ($10.9 billion) annually as a result of commercial fraud. In the first half of 2010, eight million counterfeit items were confiscated. Thousands of traffic deaths each year are caused by counterfeit car accessories and spare parts, such as tires and brakes that enter the country after customs clearance}


Looks like eventually all governments are interested in doing domething against counterfeits and the criminals running the counterfeit product rings. (Tony Zafiropoulos)

07/26/2010
$200 Billion Counterfeit Pharmaceuticals in world
Havocscope.com story:

{   1. Counterfeit Pharmaceutical Drugs$200 Billion
   2. Counterfeit Electronics$100 Billion
   3. Web Video Piracy$60 Billion
   4. Software Piracy$51.4 Billion
   5. Movie Piracy$20 Billion
   6. Counterfeit Auto Parts$16 Billion
   7. Music Piracy$12.5 Billion
   8. Counterfeit Shoes$12 Billion
   9. Counterfeit Clothing$12 Billion
  10. Cable Piracy$8.5 Billion
  11. Counterfeit Medical Devices$7 Billion
  12. Counterfeit Sports Goods and Memorabilia$6.5 Billion
  13. Counterfeit Cigarettes$4 Billion
  14. Video Game Piracy$3.5 Billion
  15. Mobile Entertainment Piracy$3.4 Billion
  16. Counterfeit Cosmetics$3.0 Billion
  17. Counterfeit Money Orders and Checks$2.5 Billion
  18. Counterfeit Toys$2.23 Billion
  19. Counterfeit Airline Parts$2 Billion
  20. Counterfeit Small Arms$1.8 Billion
  21. Counterfeit Alcohol$1 Billion
  22. Counterfeit Watches$1 Billion
  23. Counterfeit Credit and Debit Cards$0.82 Billion ($825.05 Million)
  24. Counterfeit Pesticides$0.735 Billion ($735 Million)
  25. Book Piracy$0.6 Billion ($600 Million)
  26. Counterfeit Currency$0.182 Billion ($182 Million)
  27. Counterfeit Cuban Cigars$0.1 Billion ($100 Million)
  28. Counterfeit Purses$0.07 Billion ($70 Million)
  29. Counterfeit Lighters$0.042 Billion ($42 Million)
  30. Counterfeit Batteries$0.023 Billion ($23 Million)}

Notice some interesting market totals: Auto parts has $16 Billion in counterfeits any industry that has some dependence on after market (non-original manufacturer) goods has a counterfeiting problem. If you are in one of these industries consider beating the counterfeiters by introducing an Authentication Marker (also referred to as a taggant) on your product, as in these examples.(Tony Zafiropoulos)


07/25/2010
Counterfeit Products also in Iran - including colour cosmetics
Officialwire.com story:

{In 2009, smuggled counterfeit products continued to hinder sales of colour cosmetics. Colour cosmetics are becoming increasingly popular among young Iranian women for daily use. These eager consumers usually do not have knowledge of well-known multinational brands, and are more concerned about price. As a result, products with low prices and attractive packaging are gaining popularity among Iranian consumers. They are typically counterfeit and imported from China, South Korea or Turkey.

This Colour Cosmetics Products in Iran report offers a comprehensive guide to the size and shape of the market at a national level. It provides the latest retail sales data 2005-2009, allowing you to identify the sectors driving growth. Forecasts to 2014 illustrate how the market is set to change. }

There isn't too much information in this story, but I thought it was interesting that Iran also has counterfeit product problems. (Tony Zafiropoulos)

07/24/2010
6 times increase of fake goods seizures in Greece '08 to '09
greece.greekreporter.com story:

{Greek customs have confiscated the highest number of counterfeit goods among EU countries over the past year, according to the annual report issued on Thursday by the European Commission on customs actions to enforce intellectual property rights at the EU’s external borders.
Specifically, fake or pirate goods seized by Greek customs jumped sharply from 3.6 million in 2008 to 21.9 million in 2009.

In the 27 EU countries as a whole, customs seized 118 million counterfeit products in 2009, down from 178.9 million in 2008.}

EU as a whole dropped seizures 66% of the total seized in 2009 from 2008 total. But Greece's total increased six fold. The article does not discuss the reasons for an increase of that magnitude. The top items seized were cigarettes, clothes, and designer label goods. (Tony Zafiropoulos)

07/23/2010
$5.13 million counterfeit products seized in Malaysia during the first 6 months 2010
mynews.fik4.com story:

{The Domestic Trade, Cooperatives and Consumerism Ministry seized over 900,000 pirated and counterfeit products worth RM16.5 million from January to June this year.

Its deputy minister, Datuk Tan Lian Hoe said 272 people were also arrested during the period.}

The malaysian Ringgit to the US Dollar is 16.5 to 5.13. Apparently the Malaysian department or the story does not detail what has been seized. (Tony Zafiropoulos)

07/22/2010
Computer Worm working for criminals to create counterfeit products
pcworld.com story:

{The worm, called Stuxnet, was first spotted last month, when it infected systems at an unidentified Iranian organization, according to Sergey Ulasen, the head of the antivirus kernel department at VirusBlokAda, in Minsk, Belarus. The unidentified victim, which does not own the type of SCADA (supervisory control and data acquisition) systems targeted by the worm, "told us their workstations serially rebooted without any reason," Ulasen said in an e-mail message Tuesday.


VirusBlokAda soon received reports of the malware from "all over the middle east," he added. Last week, Microsoft said that it had logged infection attempts in the U.S., Indonesia, India and Iran. Security vendor Symantec is now logging about 9,000 infection attempts per day.


After gaining access to the Iranian system, VirusBlokAda researchers were able to analyze the worm and determine that it exploited a new and unpatched vulnerability in Microsoft's Windows operating system, allowing it to spread via USB devices and networked file systems.


The highly sophisticated worm also takes advantage of default passwords used by Siemens' management consoles to connect and then try to steal industrial secrets from infected companies. If it worked, the worm could steal manufacturing "recipes" from victims, allowing criminals to counterfeit products.}


Criminals are trying all kinds of methods to make more money. Which includes attempting to circumvent firewalls and standard security procedures by trying to exploit Siemens SCADA workstations as well as unpatched Microsoft Windows systems. What is interesting is the worm is targeting manufacturing centers with it's SCADA focus. Normally worms are focused on unpatched Microsoft Windows vulnerabilities.  (Tony Zafiropoulos)

07/21/2010
$600,000 of exercise equipment seized: 1 convicted
US Immigration Customs and Enforcement story:

{Chunchai "Katherine" Yu, 47, of Chino, Calif., was charged with trafficking counterfeit exercise equipment bearing names such as Malibu Pilates, Bowflex, Beachbody and Ab Circle Pro.


"This verdict should serve as a warning to those engaged in product counterfeiting and other types of commercial piracy," said Claude Arnold, special agent in charge of the ICE Office of Homeland Security Investigations in Los Angeles. "Intellectual property crimes like these not only result in the loss of untold U.S. jobs and revenues, but the importation of substandard or tainted products also poses a serious threat to consumers' health and safety."


Since 2007,Yu operated a business that imported exercise equipment from China into the United States. Evidence at the trial revealed that when two of the defendant's shipping containers were detained in July 2009 when officers discovered counterfeit equipment, Yu paid a bribe to an undercover ICE agent posing as a CBP official in exchange for the return of those containers. Yu continued to import counterfeit exercise equipment until her arrest in February 2010.


The retail value of the counterfeit exercise equipment seized from Yu totaled nearly $600,000, and were branded with counterfeited trademarks of products legitimately manufactured by Nautilus, Inc., Guthy-Renker Corp., Product Partners, LLC, and Fitness Brands, Inc.}


Counterfeiters and their agents have a fast free wheeling life until they are caught. It takes a while to get caught and convicted, but eventually it happens. Notice that from July 2009 when the counterfeit equipment was found until her arrest in February 2010 she continued her nefarious activities. (Tony Zafiropoulos)

07/20/2010
$200 million of counterfeits seized now 2 criminals convicted
tradeandtechnology.blogspot.com post:

{Chong Lam, 52, and Siu Yung Chan, aka Joyce Chan, 42, were convicted for their participation in one of the largest counterfeit luxury goods operations in the United States. In January 2008, investigators seized approximately 1,500 cartons of alleged infringing items. In addition to criminal penalties, a civil penalty of up to the value that the merchandise would have had if it were genuine according to the MSRP, could be assessed under 19 U.S.C. 1526. The total value, in this case, of the corresponding authentic luxury goods manufactured by Burberry, Louis Vuitton, Gucci, Coach, Fendi, Chanel and others is estimated to be over $100 million.
A federal jury found Lam and Chan each guilty on one count of conspiracy to traffic in counterfeit goods imported from the China; two counts of trafficking in counterfeit handbags, wallets, purses and carry-on bags; and two counts of illegally smuggling counterfeit goods into the United States.}

The perpetrators were working out of the port of Baltimore. It took some time to convict them as the counterfeit products were seized on January 2008. (Tony Zafiropoulos)

07/19/2010
1700 pairs of counterfeit Nike shoes seized in Chicago, worth $162k
Examiner.com story:

{Three knocks on a door gave police entrance to a room filled with an estimated $162,000 worth of knock-off Nike shoes.

More than 1,700 pairs were confiscated from the backroom of at the E. Pretty Inc. store at 624 West Roosevelt Road, say police.}


Chicago is pursuing store fronts with fake products, sometimes their efforts bear fruit.The whole country seems to have counterfeit products on it's mind, but nonetheless more people are getting caught. There seems to be few days where there is no news story of seizures. (Tony Zafiropoulos)

07/18/2010
8900 counterfeit items seized in Wildwood NJ
capemaycountyherald.com story:

{On Thur., July 15, at approximately 3:50 p.m., as part of an ongoing investigation into the sale of counterfeit trademarked items, members of the Wildwood Police Department Detective Division, and Wildwood Police Department Uniformed Patrol Division executed 12 search warrants on various stores located on the Boardwalk.


As a result of the execution of these search warrants, in excess of 8,900 counterfeit trademarked items and approximately $40,000 in currency was seized. The seized counterfeit items that were offered for sale by merchants, included tee-shirts, sweatpants, sweatshirts, sunglasses, caps, and heat transfers that reflected trademark infringement on Monster Energy, Fox Racing, D.C. Clothing, Dolce Gabana, Famous Stars and Straps, and Rock Star Energy Drink.}



Trademark infringement is taken more seriously these days. (Tony Zafiropoulos)

07/17/2010
Amazon Kindle's counterfeits available on day of launch
Logisticsviewpoints.com story:

{On launch day, Kindle DXs were already available for purchase on a major B2B trade board from a company located in China. A sample of 8 seller listings on a popular trade board had an estimated 40,000 Kindles available within a few weeks after the DX launch. Suspect Kindle knockoffs were found for sale on trade boards and auctions in colors and languages not sold by Amazon.


The product launch of a highly anticipated consumer electronics product, such as the Kindle DX, presents a challenge to manufacturers desiring to maintain supply chain control in the global market. Even on the day of launch, Kindle DXs were offered for sale on a B2B trade board raising questions on how the product was acquired. Thousands of Kindle e-readers were available on trade boards from sellers, many offering significant quantities at deeply discounted prices. One seller offered 2,500 Kindle 2 e-readers per week at a unit price of $65, well below the list price of $299. Of 33 B2B listings offering Kindles when the DX launched, 75% of the sellers were located in Indonesia and China.}



This scenario is unfortunately typical, on the day of the product launch knock-offs are available for sale. The counterfeiters are sophisticated and thus the manufacturer must also be more advanced in the anti-counterfeit department to keep up with the counterfeit methods. Having a non-reverse engineer capable covert Authentication Marker would help defeat the counterfeiters. (Tony Zafiropoulos)

07/16/2010
2 arrested for trafficking in counterfeit goods for Hezbollah
myfoxphilly.com story:

{Michael Katz, 58, if Plainsboro, NJ and Alaa Allia Ahmed Mohamed a/k/a “Allaa Ahmed Mohamed Abouelnagaa”, 44, of Brooklyn, NY were sentenced on Wednesday for conspiracy to traffic in counterfeit goods and trafficking in counterfeit goods.

The charges against Katz and Mohamed were filed in conjunction with a case against four people, including Hassan Hodroj and Dib Hani Harb. They were charged with attempting to provide material support to Hezbollah in the form of approximately 1,200 Colt M4 Carbine machine guns.}

Counterfeit goods are frequently used to fund criminals and terrorist groups.. (Tony Zafiropoulos)

07/15/2010
Counterfeit Rolex (Roleks) seized 12million€ worth
Marques.org story:

{Newspaper Helsingin Sanomat reports today on their website that the Finnish Customs has caught loads of counterfeit watches on their way to Russia. The seized batch had been sent to Europe from China and it included fake watches imitating expensive brands like ROLEX, CITIZEN and HELLO KITTY. The Customs estimates that the value of the same assortment of genuine products would be 12 million euros.}

I guess one almost expects that some Rolex watches are fake, but it is interesting to see 12million€ worth.. (Tony Zafiropoulos)

07/14/2010

Using or importing counterfeits is a crime in India now
economictimes.indiatimes.com story:

{NEW DELHI: The next time you walk in through the customs flashing your fake Rolex purchased in Thailand or Hong Kong, you could be headed for trouble.

India has tightened its import norms to ensure fake product that violates design patents do not come into the country even for self use, as the country looks to contribute its bit to check global piracy.

“The new notification removes the apparent unintended anomaly of prohibiting import of infringing goods meant for trading only. Now even infringing goods imported for use or consumption in India will come under the prohibition,” said Srinivas Kotni, managing associate, Lexport, a legal consultancy firm.

Picking up a medicine not meant for sale in India for self use would also invite trouble.

A penalty of up to five times the value of the goods imported can be levied on an importer under some circumstances and prosecution can also be launched under the Customs Act.

India has tightened all of it's Intellectual Property rules and laws. It has been shown that criminals are behind counterfeit products importing and manufacture, so finally some countries are taking the necessary steps of making even a small counterfeit product purchase a crime. (Tony Zafiropoulos)

7/13/2010
FDA bans Weight loss herbal supplement: Que She - marketed for weight loss
fda.gov press release:

{The U.S. Food and Drug Administration today warned that Que She, marketed as an herbal weight loss supplement, contains active pharmaceutical ingredients not listed on the product label that could harm consumers, especially those with cardiovascular conditions.

People who have purchased Que She should stop taking the product immediately and consult a health care professional.


An FDA analysis of Que She found that it contains:

  • fenfluraminea stimulant drug withdrawn from the U.S. market in 1997 after studies demonstrated that it caused serious heart valve damage
  • propranolol – a prescription beta blocker drug that can pose a risk to people with bronchial asthma and certain heart conditions
  • sibutramine – a controlled substance and prescription weight loss drug, sibutramine was the subject of a recent study whose preliminary findings showed an association between sibutramine use and increased risk of heart attack and stroke in patients who have a history of heart disease
  • ephedrinea stimulant drug that is legally marketed over-the-counter for temporary relief of asthma but can pose a risk to people with certain cardiovascular conditions.}

This is typical of various counterfeit drugs coming out of China. the FDA has a Chinese language version of the press release also. This is a counterfeit drug because it contains more than just wight loss ingredients. My recommendation is not to purchase your drugs or herbal supplements from China or Chinese sources.  Unfortunately one does not know what is in the product.(Tony Zafiropoulos)

7/12/2010
U.S. Immigrations Customs Enforcement(ICE) hosts event in New Orleans
ice.gov statement:

{ On 7/9/2010 ICE Homeland Security Investigations (HSI) Office Assistant Special Agent in Charge C. Vernon Francis welcomed the group and provided opening remarks.

"The trade in counterfeit goods costs legitimate businesses millions of dollars in lost revenue. The illicit proceeds also support other criminal activities in the U.S. and around the world," said Francis. "ICE investigations focus not only on keeping counterfeit products off U.S. streets, but also on dismantling the criminal organizations behind this activity."

IPR Center National Program Manager Thomas Hipelius discussed the IPR Center's national coordination efforts with state and local law enforcement.


In fiscal year 2009, ICE partnered with U.S. Customs and Border Protection (CBP) making 14,841 seizures of counterfeit or pirated merchandise nationwide with a domestic value of over $260 million. During that same period, ICE made 414 criminal arrests, had 160 indictments, and had 203 criminal convictions for IP theft crimes.}


ICE seized $260 million dollars last year, and realistically they do not catch everything. To safeguard your products you should use anti-counterfeit technology that cannot be reverse engineered. (Tony Zafiropoulos)

7/11/2010
Monster: manufacturer of cables & consumer electronics  has vigorous brand protection
Earthtimes.org story:

{Monster, a leading manufacturer of cables, headphones and consumer electronics accessories, today announced that its Brand Protection team, working in partnership with the  Los Angeles County Sheriff’s Department, made its second arrest in four months yesterday of an alleged counterfeit seller in the Los Angeles area. The two recent arrests are at the vanguard of an intense “Monster Dragnet” to halt illegal counterfeit sales and manufacturing of its products, both here and around the world.

The second arrest took place on June 24, 2010 in Beverly Hills. The female perpetrator was taken into custody on felony charges by the Los Angeles County Sheriff’s Department, after they served her with a warrant and searched her premises. Her boyfriend was also taken into custody on unrelated charges as a result of this effort.

David Tognotti, Monster’s General Manager and Vice President of Operations noted: “The manufacture and sale of counterfeit consumer electronics products is a major concern to all legitimate manufacturers, retailers, and, of course, our customers. Monster wants to make sure that when people make the choice to buy a Monster product they are getting a genuine Monster product.

Consumers with ANY information or questions regarding counterfeit products or diverted products are encouraged to contact: Camilla Herron, Brand Protection Manager – Monster Cable Products, Inc. 415–330-4402 begin_of_the_skype_highlighting              415–330-4402 begin_of_the_skype_highlighting              415–330-4402      end_of_the_skype_highlighting      end_of_the_skype_highlighting }

It just so happens I bought one of their Surge protectors last week, I did not notice anything unusual on the package. The Monster management has one of the correct strategies in place, the other two are covert and overt brand protection. Covert brand protection consists of an Anti-Counterfeit technology or otherwise known as an authentication marker and taggant. In our case we can make our taggant non-reverse engineer capable. (Tony Zafiropoulos)

7/10/2010
Namibia relies on other countries institutions for quality control causing loophole
informante.web.na story:

{Recent revelations by the Namibian Standards Institution that the country still relies heavily on the South African Bureau of Standards (SABS) to control the quality and standard of consumable goods entering the country leaves a lot to desired on the protection of Namibian industries. Only this month NSI signed a memorandum of understanding with their South African counterparts to promote corporation and the CEO Riundja Ali Kaakunga defended the country’s import standards where counterfeit Chinese products find their way on to the shelves, as affordable

Considering that the country celebrated 20 years of independence and a maturing democracy, the heavy reliance on SABS is in no uncertain terms a big concern for President Hifikepunye Pohamba and his team as this exposes the lack of commitment from lawmakers in safeguarding the Namibian market and promoting local industry.

While Namibia like any other African country continues to be a dumping ground for counterfeit products from Asia, NSI is still to come up with a reasonable framework of promoting quality services and products.

Chinese are among the world’s best manufacturers of products exporting to countries as far afield as the United States of America, Britain and Europe as a whole but the fact that NSI relies on other bodies for quality checks creates a loophole for the Chinese to dump counterfeit products in Namibia.
}

It seems that wherever law and order is still coming together the counterfeiters are finding those areas easiest to infiltrate. Affordable Chinese counterfeits is what a lot of people say is the reason it is ok for counterfeits to make it on the shelves of a countries' stores. (Tony Zafiropoulos)

7/9/2010
CNBC has show about Counterfeit Goods July,14th 9pm EST
classic.cnbc.com schedule:

{United States
Premieres Wednesday, July 14th  9p | 10p | 12a | 1a ET

about the show:
Fake handbags, watches, shoes and perfumes. The business of Counterfeit Goods is the largest underground industry in the world. Hundreds of billions of dollars are generated while sapping the economy, putting lives in jeopardy, and funding organized crime in the process.

CNBC’s "Crime Inc.: Counterfeit Goods," takes viewers on a rare look inside a global crime spree, where the goods are produced and confiscated in a world of high-risk and high-reward.

Host Carl Quintanilla takes you on raids with the LAPD anti-counterfeiting unit, inspections at ports, and back-room factories where counterfeits are produced. Meet a husband and wife who were paralyzed by counterfeit Botox, a company whose whole brand was copied, and the story of a defense contractor who counterfeit defense parts that found their way into weapons depots in Iraq.}

It will be interesting to see some of the images of the stories that I highlight in this blog and is about our industry. Of course another story is how companies can hedge themselves with legal liability by fortifying their products with anti-counterfeit technology:  Authentication marker or taggant for a covert solution.(Tony Zafiropoulos)

7/8/2010
HTC Hero (Android OS) phone counterfeits are here
trendgadget.com video:

{The clones are springing up like mushrooms, and HTC Hero has not been spared. But most of the copies made in China known to date, offer a version with Windows Mobile processor Hisilicon K3. Except this latest clone offering not only a capacitive touch screen but in addition carbide OS Android. I do not even speak of design that is exactly the replica of HERO. There’s no doubt, we are truly in the presence of a counterfeit, which will in the coming days giving trouble to HTC.}

The counterfeits will be difficult to differentiate from real HTC cell phone devices. Unless one has an Authentication Marker (or taggant) that is not reverse-engineer capable. Otherwise the counterfeiter would fake that as well. We can show you some examples, you can contact us to discuss how we can help you set up the marker on your prosuct. (Tony Zafiropoulos)

7/7/2010
44% of anti-malaria medicine from Senegal fail quality tests
allafrica.com story:

{The severity of the situation is clear and has called for action among relevant authorities. This year, in a survey done by the US Pharmacopeia found out the 44 per cent of anti-malaria medicines from Senegal failed quality tests. In Uganda, the failure rate was 30 per cent and in Madagascar 26 per cent.


In a survey at some Dar es Salaam clinics by Julian Harris, a Research Fellow at International Policy Network based in London, there are interesting findings. In the report, she says she visited small clinics in the city, which are providing excellent service to communities that were until recently neglected by the government health system.


Studies show that throughout the continent, failure rates are frequently observed at around or over one third of drugs. A peer reviewed 2008 study put the rates in Ghana, Kenya, Nigeria and Rwanda respectively at 35, 38, 32 and 33 per cent. In this country, 32 per cent were sub-standard.

During last two years, 1,550 food building houses were inspected of which 1,274 were ok and 82 per cent of them met the required standards and were awarded processing and selling permits.

Over 5,000 buildings that deal with medicines and cosmetics products in the country were inspected, of which 834 (about 17 per cent) met the required standards.}


Counterfeit medicines can be deadly to patients. (Tony Zafiropoulos)

7/6/2010
Tips on reviewing Stella McCartney handbags for counterfeits
howtodothings.com post:

  • Study the materials used in the handbags. Stella McCartney handbags use only the finest quality of pure leather. Genuine leather is sturdy yet smooth on the feel. It should have a natural shine and must be flexible when folded. Though leather can be colored, make sure the color blends well without the material looking wet and too shiny.
  • Get hold of a copy of the palette of colors used by Stella McCartney handbags. Compare the shade of the color that corresponds to the color of the handbag you want to purchase. The palette usually comes in the form of small leather samples so you can easily tell if the material used is fake or real. If you cannot get hold of a hard copy of the palette, go to Stella McCartney website and search for their color samples. Take note also that varied colors of Stella McCartney handbags are specifically described such as: red, black, blue, silver, pink, green or yellow. Imitations usually use pale yellow, dark green or light brown in their color descriptions.
  • Scrutinize the zippers, locks, key chains, buckles, buttons, clasps and other hard materials used in the bag. Zippers should be thick and must have large teeth especially at the main opening of the handbag. Clasps must be easy to snap in and out. The key chains must bear the logo of Stella McCartney bags.
  • Go over the stitches of the handbag. Well-run stitches (which are very characteristic of a real Stella McCartney bag) must be smooth, even and intact. Stitches must not wear down easily. Loose stitches indicate that the handbag is not designed and made originally by Stella McCartney. See to it that the stitches really penetrate the materials, and are not used as decorations. Stitches on fake bags usually do not go through the material. Instead, glue is used to put the pieces together with just decorative stitches on the surface.
  • Compare the real Stella McCartney bags (as they appear from the company website) with the one you are examining. There should be no discrepancy whatsoever. The bag you have on hand should bear exact details with the one you see on the website. A missing single button or clasp that cannot be located in place is a sign that the handbag is an imitation.
}

This is one of the three strategies to pursue to foil counterfeiters- help consumers differentiate your products from counterfeiters. The second is overt branding (which is the logo), and the third is covert tags or taggants/Authentication Markers. Then one has a detector to check if the bag has the Authentication Marker on the bag or not.(Tony Zafiropoulos)

7/5/2010
Smoot-Hawley Tariff Act used to stop Intellectual Property infringement
Law.com story:

{Authorized by 19 U.S.C. §337, the Smoot-Hawley Tariff Act of 1930 allows certain entities to block importation of goods that infringe valid United States intellectual property. Under §337 of the Act, the ITC conducts investigations into allegations of certain unfair practices in import trade (for information on §337 investigations, see, www.usitc.gov/intellectual_property/documents/337_faqs.pdf). Such unlawful practices include the infringement of intellectual-property rights and other forms of unfair competition in import trade. The investigations typically involve an allegation of:

• patent or registered-trademark infringement;

• misappropriation of trade secrets;

• passing off counterfeit goods; or

• false advertising.

The ITC is a federal agency that can stop the importation of goods ordered over the internet from foreign vendors, after the agency receives a §337 complaint. Historically, nearly all complaints alleging that a U.S. intellectual property is violated by imported goods via traditional means or via the internet have been investigated and an action favorable to the complainant has resulted.

In fiscal year 2000, the organization handled a dozen cases. Ten years later, the agency's annual caseload has increased nearly tenfold. The reason for this increase was an opportunity for a resolution that is typically years faster than the standard litigation process, and much less expensive. After an investigation is instituted, the entire process, including a hearing, typically takes less than 18 months.


CBP ENFORCEMENT

CBP examines cargo entering the country to ensure that it is in compliance with a variety of laws. The examination includes a check to determine whether or not an importation infringes on someone else's intellectual-property rights, by, in part, checking a database of trademarks, trade names and copyrights that CBP has compiled.

Trademarks and copyrights that have been registered with the U.S. Patent and Trademark Office, or the U.S. Copyright Office may be recorded with CBP for a fee of $190.

Once the offending goods are found, they will be seized. A seizure notice will be issued to the importer, who may petition for administrative relief, or elect to bring suit in federal district court to recover the merchandise.

Goods that are seized and forfeited as bearing a mark that is a counterfeit of a registered trademark, piratical of a registered copyright, or imported in violation of distribution-rights agreements, are routinely destroyed, unless the owner gives permission for other disposition, such as charitable donation. Significant monetary penalties may also be assessed for violations involving the importation of goods bearing counterfeit marks.}


This web page goes over some of the details of what a company should do if they find out their product has been counterfeited and who they should contact in the US government. Notice that this is all after the fact, and is part of the enforcement angle of your product.  One still has to create covert markers and overt branding to let everyone know that this product is your Intellectual Property. There is also the legal angle, where the potential exists a fake product might be mistaken for your real product. It is possible that the fake product could give you legal liabilities. Of course if you had a covert Authentication Marker or taggant this would not be the case. (Tony Zafiropoulos)

7/4/2010
$62k counterfeits seized in Taiwan 6 arrested
news.asiaone.com story:

{The Criminal Investigation Bureau (CIB) yesterday arrested six suspects in Taipei for allegedly manufacturing and selling counterfeit skin care products and food supplements, said the CIB.


The CIB and police from Yilan raided three places in northern Taiwan, seizing fake Complex Placenta Skin Essential from RJ International Group and Oyster and Clam Extract from Taiwan Sugar.


The fake goods totaled more than NT$2 million (S$86,397), police officials said.}

There does not seem to be a shortage of counterfeiters.  $2mil Taiwan Dollars equal $62,000 USD (Tony Zafiropoulos)

7/3/2010
2.5 million printing supplies seized in Europe, Middle East & Africa
tradearabia.com story:

{A total of 2,529,984 counterfeit printing supplies were seized in the Europe, Middle East and Africa (EMEA) regions from November, 2008 through January, 2010, said a report.


HP, the leading technology company, recently released an anti-counterfeit whitepaper ‘Countering the counterfeiters’, giving a background on the scale of the counterfeit problem in the region.


Counterfeiting in printing supplies is estimated to be a multi-billion dollar trade worldwide, with organised crime syndicates often behind the illegal manufacture, distribution and sale of printer cartridges, said Amin Mortazavi, HP Middle East IPG general manager.}


HP is trying to aggressively pursue the counterfeiting operations in the Europe, Middle East and Africa. (Tony Zafiropoulos)

7/2/2010
British GHD to stop 2 women from trademark infringement in South Africa re: Hair straightning product
legalbrief.co.za story:

{The British makers and local distributors of the popular electrical hair straightner brand GHD have won a court order against two Cape Town women who allegedly sold counterfeit GHD products.

A Cape Times report says Narriman Hendricks and Reumaysa Khan were ordered by the Western Cape High Court to immediately stop trading in alleged GHD counterfeit products and hand over all their unauthorized goods bearing the trademark GHD. The court also allowed for an official trademark infringement inquiry to be held to find out how many GHD labeled products the pair have sold, to determine the amount of royalties they owed to the official manufacture and distributor of GHD products - the Jemella Group, based in West Yorkshire. The report notes the court application was granted to Jemella and its exclusive SA distributor, the Durban-based company Good Hair Day SA.}

It seems that the women were making counterfeit GHD electrical straightners. (Tony Zafiropoulos)

7/1/2010