Nasty knockoffs: Dangerous fake products enter U.S. at record pace
In Harlem, New York City, Geoffrey Quinn used to buy $5 packs of untaxed cigarettes on the street. But then he noticed that the Marlboros tasted different and hurt his throat.
In Sanford, N.C., a big-rig driver pulled a just-installed valve to set the brakes. The part broke off and built-up air pressure shot a valve piece out like a bullet, just missing him as it ricocheted through the truck’s cab.
In Detroit, Mich., a couple was hot and heavy, thinking their old reliable Trojan Magnums would protect them from pregnancy. But something was most definitely wrong.
“That damn banana smell just threw me all off,” an angry writer named Soulsistah wrote at allhiphop.com, an urban news site. “The size of the thing was definitely way off and it broke within minutes.”
The cigarettes, dash valves and condoms were defective for the same reason: they were fake. And they are only a few of the record number of counterfeit products on the U.S. market that endanger unwitting consumers.
“Counterfeiting is a rapidly growing problem,” said Rob Calia, director of the U.S. Chamber of Commerce’s Global Intellectual Property Center. “More and more products are being copied that pose significant risks to consumers, often that they don’t know are fake and dangerous.”
The days of seemingly harmless knockoffs such as Rolex watches, Louis Vuitton purses and Nike sneakers are over. The value of counterfeit seizures in 2007--nearly $197 million--was 27 percent more than 2006, the highest ever, according to figures released this year by the Department of Homeland Security.
Fakes always cost companies dollars, but today consumers may be paying with their health from a rash of lesser known and potentially dangerous items like counterfeit Lipitor, diabetic test strips and power cords.
Indeed, counterfeiting is big money.
Coupled with piracy, it costs the U.S. economy between $200 billion and $250 billion per year, according to the Chamber. Counterfeiting and piracy also are directly responsible for the loss of more than 750,000 American jobs, it says.
Worse, some of the profits from counterfeit sales may have gone to fund terror. The 1993 World Trade Center bombing was partly financed through the sale of fake clothes like Nike t-shirts and an Al-Qaeda training manual recommended the sale of fake goods as a financing source, according to Interpol, the international police force.
On the street level, counterfeits are often bought and used with little knowledge of the additional risk.
In parts of Harlem, Brooklyn and the Bronx, sidewalk vendors known as “$5 men” are increasingly selling counterfeit smokes along with regular untaxed packs of Newports and Marlboros, law enforcement officials say.
Most counterfeit cigarettes come from China and North Korea and studies have identified inconsistent ingredients that are in most cases more dangerous than regular ones. There’s an average of five times more cadmium, six times more lead and elevated levels of arsenic and metals in Chinese fakes, according to research from St. Andrews University in Scotland.
In 2007, U.S. Customs officials seized $583,349 worth of counterfeit cigarettes. Other busts indicate the problem is much larger. In 2005, U.S. authorities seized more than one billion smuggled fake cigarettes in California--worth $42 million--many of which were believed to be from North Korea.
Counterfeiting cigarettes “is a very big problem,” said Matthew Myerson, an ATF attorney in New York, noting that a container of $30,000 worth of cigarettes from China has a New York street value of $1 million. “The quality is getting better and better,” he added. “It’s hard even for the industry to figure out.”
Like cigarettes, counterfeit automotive parts are on the U.S. market in record numbers. They include brake linings made of compressed grass, sawdust or cardboard that wear out quickly; spark plugs that overheat and can lead to fires; and gas caps that can leak after rollover accidents.
The value of auto components seized by customs officials was $845,094, but that's only a fraction of the fakes that make it onto shelves and into cars and trucks. Between 2001 and 2006, General Motors alone conducted 1,000 investigations and seized $44 million in counterfeit auto parts. Despite their efforts, millions of knockoff components enter the country each year, according to the industry, costing it $12 billion annually.
“We are seeing more counterfeit parts each year” in the U.S. commercial vehicle industry, said Andy Cifranic, the brand manager at Bendix Commercial Vehicle Systems LLC. “We have seen many incidents of counterfeit parts failing prematurely and leading to potentially hazardous situations.”
Counterfeit condoms have also entered the U.S. The number of fake prophylactics-–sold mostly in bodegas and online--is minuscule compared to other knockoffs, but their dubious quality still raises concerns.
In 2007, counterfeit Trojan Magnums were found in New York, Baltimore and Detroit. They were packaged almost identically to the real brand, but were slightly smaller in size and smelled fruity--like bananas in at least one case that made its way onto several Internet talk boards. Earlier this year, a grocery wholesaler outside of Milwaukee, Wis., was caught buying and selling nearly 250,000 fake Trojan condoms, none of which made it to consumers.
Church & Dwight, maker of Trojan condoms, estimates about 4 million counterfeit Trojans have been confiscated by law enforcement and company investigators.
“Because we cannot vouch for the safety and efficacy of counterfeit products, consumers who think they may have used counterfeit product should consult a physician or family planning clinic,” Church & Dwight said in a Feb. 21 statement.
Industry experts note that while troublesome, counterfeit condoms are not commonplace. “It’s a very small and isolated problem,” said Adam Glickman, founder and CEO of condomania.com and industry expert.
But those who have been affected are mad. “What if someone trying to practice safe sex and preventing pregnancy gets caught up in this mess?” asked the Detroit woman about fake condoms.
“This isn’t just a minor inconvenience; this is life threatening!”