To counterfeit means to imitate something. Counterfeit
products are fake replicas of the
real product. Counterfeit products are often produced with the intent to
take advantage of the superior value of the imitated product. The word
counterfeit frequently describes both the forgeries of
currency and
documents, as well as the imitations of works of
art,
toys,
clothing,
software,[citation
needed]
pharmaceuticals,
watches,
electronics,
handbags and
shoes. Counterfeit products have a fake company
logos and
brands. In the case of goods, it results in
patent infringement or
trademark infringement. Illegal drugs may also be counterfeit, e.g.
by passing off baking soda as cocaine, a scam which relies on the
naivete
of the buyer. Counterfeit consumer products have a reputation for being
low quality.
The
counterfeiting of money is usually attacked aggressively by
governments. The counterfeiting of goods is condoned by some
governments. Counterfeit money is the most popular product
counterfeited.
Counterfeiting of money or government bonds
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section requires
expansion. (December 2009) |
Counterfeit money is currency that is produced without the legal
sanction of the state or government and in deliberate violation of that
country's laws.
The
United States Secret Service, mostly known for its
guarding-of-officials task, was initially organized primarily to combat
the counterfeiting of American money. Counterfeit
government bonds are public debt instruments that are produced
without legal sanction, with the intention of "cashing them in" for
authentic currency or using them as
collateral to secure legitimate loans or lines of credit.
Counterfeiting of documents
Forgery is the process of making or adapting documents with the
intention to deceive. It is a form of
fraud,
and is often a key technique in the execution of
identity theft.
Uttering and publishing is a term in United States law for the
forgery of non-official documents, such as a trucking company's time and
weight logs.
Questioned document examination is a scientific process for
investigating many aspects of various documents, and is often used to
examine the provenance and verity of a suspected forgery.
Security printing is a
printing industry specialty, focused on creating legal documents
which are difficult to forge.
Counterfeiting of consumer goods
A
Sharpie marker, next to a "Shoupie" marker.
Counterfeit
LG brand and products, such as television, monitor, air
conditioner, etc.
The spread of counterfeit goods (commonly called "knockoffs") has
become global in recent years and the range of goods subject to
infringement has increased significantly. Apparel and accessories
accounted for over 50 percent of the counterfeit goods seized by U.S
Customs and Border Control. According to the study of Counterfeiting
Intelligence Bureau (CIB) of the International Chamber of Commerce
(ICC), counterfeit goods make up 5 to 7% of World Trade, however these
figures cannot be substantiated due to the secretive nature of the
industry.[1]
A report by the
Organisation for Economic Co-operation and Development indicates
that up to US$200 Billion of international trade could have been in
counterfeit and illegally-copied goods in 2005.[2]
In November 2009, the OECD updated these estimates, concluding that the
share of counterfeit and pirated goods in world trade had increased from
1.85% in 2000 to 1.95% in 2007. That represents an increase to US$250
billion worldwide.[3]
In a detailed breakdown of the counterfeit goods industry, the total
loss faced by countries around the world is $600 billion, with the
United States facing the most economic impact.[4]
When calculating counterfeit products, current estimates place the
global losses at $400 billion.[5]
On November 29, 2010, the
Department of Homeland Security seized and shut down 82 websites as
part of a U.S. crackdown of websites that sell counterfeit goods, and
was timed to coincide with "Cyber Monday," the start of the holiday
online shopping season.[6]
Some see the rise in counterfeiting of goods as being related to
globalization. As more and more companies, in an effort to increase
profits, move manufacturing to the cheaper labour markets of the third
world, areas with weaker labour laws or environmental regulations, they
give the means of production to foreign workers. These new managers of
production have little or no loyalty to the original corporation. They
see that profits are being made by the global brand for doing little
(other than advertising) and see the possibilities of removing the
middle men (i.e. the parent corporation) and marketing directly to the
consumer.
Certain
consumer goods, especially very expensive or desirable brands or
those that are easy to reproduce cheaply, have become frequent and
common targets of counterfeiting. The counterfeiters either attempt to
deceive the consumer into thinking they are purchasing a legitimate
item, or convince the consumer that they could deceive others with the
imitation. An item which makes no attempt to deceive, such as a copy of
a DVD with missing or different cover art, is often called a "bootleg"
or a "pirated copy" instead.
Most counterfeit goods are produced and manufactured in China, making
it the counterfeit capital of the world. In fact, the counterfeiting
industry accounts for 8% of China's GDP.[7][8]
Joining China are North Korea and Taiwan. Some counterfeits are produced
in the same factory that produces the original, authentic product, using
inferior materials. Another strange new trend in counterfeiting,
especially seen in consumer electronics, is the manufacture of entirely
novel products using poor quality materials or, more often,
incorporating desirable features not present in a brand's authentic
product line and then including prominent and fake brand names and
logotypes to profit from brand recognition or brand image. An example
would be imitation "Nokia" cellular phones with features like Dual-SIM
slots or
TV, which are unavailable in authentic originals. Another example
would be imitation "iPod" MP3 players whose power cells or batteries are
removable and replaceable, whereas in authentic originals the power
cells or batteries are permanently installed.
In the United States, a federal crackdown on counterfeit imports is
driving an increase in domestic output of fake merchandise, according to
investigators and industry executives. Raids carried out in New York
City resulted in the seizure of an estimated $200 Million in counterfeit
apparel, bearing the logos of brands such as "The North Face," "Polo,"
"Izod Lacoste," "Rocawear," "Seven for all Mankind," and "Fubu." One of
the largest seizures was a joint operation in Arizona, Texas and
California that seized seventy-seven containers of fake "Nike Air
Jordan" shoes and a container of "Abercrombie
& Fitch" clothing, valued at $69.5 million. Another current method
of attacking counterfeits is at the retail level.
Fendi
sued the
Sam's Club division of
Walmart
for selling fake "Fendi" bags and leather goods in five states. Sam's
Club agreed to pay Fendi a confidential amount to settle the dispute and
dismiss the action. In the case
Tiffany v. eBay,
Tiffany & Co. sued auction site
eBay for
allowing the sale of counterfeit items.
Gucci
filed suit against thirty websites in the United States and is currently[when?]
in the process of suing one hundred more.[citation
needed]
A number of companies involved in the development of
anti-counterfeiting and brand protection solutions have come together to
form special industry-wide and global organisations dedicated to
combating the so-called "brand pirates". These are the International
Authentication Association[9]
and the
International Hologram Manufacturers Association. Other companies
and organizations have established web-based communities that provide a
framework for crowd-sourced solutions to counterfeiting. One such free
community, Collectors Proof[10]
enables manufacturers and users alike to associate unique identification
numbers to virtually any item so that each new owner can update its
chain of custody. Because quality counterfeit items are often difficult
to discern from authentic goods, this approach enables potential
customers to access an item's current and previous owners - its
provenance - prior to purchase.
To try to avoid this, companies may have the various parts of an item
manufactured in independent factories and then limit the supply of
certain distinguishing parts to the factory that performs the final
assembly to the exact number required for the number of items to be
assembled (or as near to that number as is practicable) and/or may
require the factory to account for every part used and to return any
unused, faulty or damaged parts. To help distinguish the originals from
the counterfeits, the copyright holder may also employ the use of serial
numbers and/or holograms etc., which may be attached to the product in
another factory still.
See also