The spread of counterfeit goods has become global in recent years, with the Internet being seen as a lucrative source to sell imitation products.
As part of an attempt to combat the selling and distribution of fake goods, the U.S. Department of Justice has seized more than $1.5 million in profits from the sales of fake sportswear manufactured in China.
The seizure of the money came as the result of an investigation into the sale of counterfeit items on commercial websites, which, according to a press release from the Department of Justice, also resulted in the seizure of three domain names used in the sale of the counterfeit sports goods.
The funds were detained from interbank accounts and six money service business accounts.
A Chinese Operation Dismantled
As court documents state, the individuals involved in the distribution of the fake goods conducted sales and processed payments using money service business accounts and then wired proceeds to bank accounts held at a Chinese bank.
According to the DoP press release, the developments into combating online counterfeit crime follow quickly on the heels of another FBI success last month, when the FBI seized more than $890,000 in fake sports apparel being sold on commercial websites.
These latest developments in fighting Internet counterfeit crime are part of a new law enforcement initiative by the U.S. Immigration and Customs Enforcement (ICE), known as Operation In Our Sites.
Operation In Our Sites was launched in June 2010 that aims to “target the sale of counterfeit goods and intellectual property piracy on the Internet.” (
Four months following its launch, the federal law enforcement initiative rolled out on Cyber Monday – a term created by companies to persuade people to shop online – when, according to a Forbes report, 82 websites were seized during the Cyber Monday-related operation.
Taking Out Counterfeit Operations
The Staggering Costs of Chinese Counterfeiting
According to ABC News, Chinese counterfeiting costs foreign companies an estimated $20 billion a year in lost profits.
Following an inspection of a pair of ski gloves, emblazoned with a prominent North Face label, Charles Scholz, a genuine “fake buster” and the Asia director for the security consulting company, Kroll Associates, who is regularly hired by international corporations to ‘root out’ counterfeiters, told ABC News:
“The tag is real, the product is not.”
He told ABC News that not only would the gloves not keep you dry, but “…if you buy this, you get soaked.”
While U.S. officials are conducting large operations to combat online counterfeit crime, which is costing foreign companies an estimated $20 billion a year in lost profits, officials are still reluctant to attempt to shut it down completely, as the counterfeit business itself creates millions of jobs during a time when jobs are badly needed.
As Charles Scholz told ABC News:
“Actually, trying to put a stop to it [Chinese counterfeiting] is going to take some fundamental changes in the society and economy here.”
During the Cyber Monday operation, federal agents made undercover online purchases of designer and sports items such as golf equipment, handbags, sunglasses, footwear and sports jerseys, all of which were purchased from online retailers that were suspected of selling counterfeit items.
As suspected, all of the items featured fake labels and trademarks.
In February this year, in the biggest seizure to date under Operations In Our Site, federal authorities announced they had seized and shut down 307 domains, 16 of which were allegedly involved in selling unauthorised and fake sports goods, including National Football League paraphernalia.
To date, a total of 761 domain names have been seized from websites used in the sale and distribution of either counterfeit goods or illegally copied works as a result of Operation In Our Sites.
In conversations about counterfeit items being sold, the issue of China crops up regularly. The general belief is that China seems to be the biggest culprit when it comes to producing and selling fake goods.
That belief is somewhat justified by the relentless flow of reports emerging involving Chinese counterfeit items, such as the recent announcement by the Department of Justice about the detainment of proceeds from the sale of counterfeit sports apparel that had been manufactured in China.
Content thanks to Top Secret Writers
References & Image Credits:
Justice.gov
Forbes
Wired
ABC News
ABC News Radio
LA Times
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