Counterfeiting is far from a victimless crime. We’ve suspected for a long time that counterfeit goods have been used to fund organized crime, terrorist organizations and large-scale crime syndicates.
French authorities found that the Charlie Hebdo attackers financed their terrorist attack in part by trafficking counterfeit sportswear, while the group accused of the Madrid train bombings in 2004 had used proceeds from the sale of pirated goods to fund their activities. International authorities also found Al Qaeda training materials that suggested using counterfeit goods to fund its activities.
Illegal counterfeit rings are commonly found hiding in plain sight, such as market stalls and second-hand shops. But in the era of e-commerce, the majority of counterfeit sellers are now listing items on well-known online marketplaces such as Amazon, eBay and
Why counterfeiting? In terms of the levels of risk involved compared with potential gains, the penalties are fairly low for people caught selling counterfeits.
In France, selling counterfeit products is punishable by a two-year prison term and a €150,000 fine. Compare this to selling illegal drugs which is punishable by a ten-year prison term and a €7,500,000 fine.
In the UK, the maximum sentence for the sale of counterfeit goods is around 10 years in prison, but most cases are much shorter. One man found selling more than £2 million worth of fakes received just 32 months in prison.
Brands need smarter technologies capable of outsmarting terrorist and organized criminal groups. AI/machine learning and clustering technology are capable of scanning through the mass amount of fake goods available on the Internet and find behavioral patterns linking sellers back to illegitimate websites, social media profiles, and even physical addresses.
But heightened awareness of the issue is also needed, as it’s highly unlikely consumers would knowingly purchase fakes if they knew where their cash was going.
Penned by Tosshan Ramgolam, Brand Advisor at Incopro