Truth in Numbers

Numbers are often a matter of interpretation. An increase in crime statistics, for example, might actually be good news if the statistics reflect increased enforcement and not increased criminal activity. Whether yesterday's released numbers on counterfeit seizures in the United States reflect better enforcement or a worsening counterfeit flood will require some digging, but the volume is staggering and a bit grim. According to the Associated Press, the United States Government seized over $270 million in counterfeit and pirated goods in 2008. These numbers represent a staggering 38% increase over 2007 numbers. Richard Rocha, a spokesman for Immigration and Customs Enforcement and apparently an optimist, credited improved law enforcement collaboration for the increase in counterfeit seizures.

Stopping Traffic

It's the old story - attract the attention of a state trooper for a minor traffic infraction, only to be discovered couriering around over 600 counterfeit handbags worth over $100,000. Well, except for the handbags part, but still, contraband is contraband, and two Chinese nationals are in hot water over their indiscretion. Apparently, police dogs sniffed out the rogue bags. Who knew counterfeit handbags had their own smell? Or that police dogs were so smart?

Up in Smoke

Counterfeit cigarettes seized in a raid in Felixstowe (UK). The cigarettes were hidden in a consignment of fireworks.

Real Tanks Defeat Fake Goods

Ah, the Russians. As an American growing up in the Age of Reagan 80's, the Soviet Russians made for the perfect villains - powerful, ruthless, cunning. Armed with nuclear weapons and commanding an enormous Red Army, the Communist hordes would stop at nothing to defeat the West and subvert democracy under the yolk of Lenin and Marx. Or so my teenage mind believed.

With a new Cold War of sorts starting following Russia's partial annexation of Georgia, it stands to reason that the Russians might want to encourage activities to undermine the capitalism of their old foes. That part might be true, but we see that counterfeiting harms the Russians, too. The Class 46 blog shows some photos of powerful Russian T-80 tanks rolling over unspecified counterfeit goods. The goods, ground into dust under the 42-ton tank, never stood a chance.

Now that's some law enforcement.

Counterfeiters' Depraved Bedfellows

As a native New Yorker, I have seen my beloved city transform from the filthy and crime-infested Gotham of the 70s and 80s to the gleaming and relatively crime-free Metropolis it is today. This transformation came about largely from the political will to implement police counters to "broken windows." According to the Broken Window theory, enforcing the law on small crimes such as vandalism (breaking windows) not only improves the quality of life for city residents, it also nets criminals wanted for other crimes. If someone is willing to jump bail for a large crime, why wouldn't he also be willing to commit a more menial sin, such as jumping a subway turnstile? As the NYPD began to enforce the law for smaller crimes, they suddenly netted a large number of criminals wanted for larger crimes. Scofflaws of misdemeanors and flouters of felonies turned out to be largely the same people. So as law enforcement took action enforcing the smaller violations, all crime dropped steeply.

In the Philippines, Emil Jurado writes in the Manila Standard of a similar phenomenon encountered by Optical Media Board Chairman Edu Manzano (scroll to the bottom of the page). Manzano's job is to enforce anti-piracy laws, but he has found that the raids conducted by the OMB have captured large amounts of child pornography. As Manzano has no legal authority to enforce child pornography laws through his agency, he has decided instead to form the Anti-Child Abuse and Pornography Foundation, a public-private partnership to address his new-found concerns. God bless him.

But the larger point is this - counterfeiting is a criminal problem. Perhaps the public is not sympathetic to the enforcement of anti-counterfeiting laws on some items because the sellers are rich and the items expensive. But even counterfeiting these items is a crime. What Manzano has shown is that counterfeiting and piracy are gateways to the greater evils of child pornography. And while his actions and increased counterfeiting enforcement may not be solely paving Manila's transformation from Gotham to Metropolis, they are providing lifelong solace to those children who might otherwise have been victimized by these counterfeiting, molesting monsters.

Allegations...

Via Liliana at Harper's Bazaar, the United States government is adding a new tool to its counterfeit-fighting repertoire - e-Allegations. By submitting an online form or by calling 1-800-BE-ALERT, a person with knowledge of counterfeit activities can alert U.S. Customs of the shadowy activities.

e-Allegations operates as something of a catch-all, its nets cast broadly for other trade, health and safety violations in addition to intellectual property crime. Given the level of organized crime involved in counterfeiting, the site offers a nice anonymity options for online submissions. Unfortunately, the heavy disclaimer (including an explicit warning of government monitoring of traffic and submissions) may well dampen the anonymity effectiveness. Check it out if you have the chance (or, if you know of some counterfeiters).

Another Wrist Slap

Some more news of enforcement against dealers of counterfeit drugs. Here, British authorities got convictions against Mr. Shabbir Hussain and Mr Mohammed Yasser Zaidi and seized just under half a million British pounds worth of counterfeit drugs.

Again, that the authorities are devoting resources to enforcement of anti-counterfeit drug laws is good news. The publicity brings attention to the problem. Unfortunately, the attention also allows the public to weigh costs and benefits of the criminal activity, and such weighing is obviously not good. Mr. Hussain did receive a four year sentence, while his co-conspirator Mr Mohammed Yasser Zaidi received a suspended sentence plus community service.

Let's take a look at drug laws in the United Kingdom.

Penalties for possession and dealing

		Possession:	Dealing:
Class A	Ecstasy, LSD, heroin, cocaine, crack, magic mushrooms, amphetamines (if prepared for injection).	Up to seven years in prison or an unlimited fine or both.	Up to life in prison or an unlimited fine or both.
Class B	Amphetamines, Methylphenidate (Ritalin), Pholcodine.	Up to five years in prison or an unlimited fine or both.	Up to 14 years in prison or an unlimited fine or both.
Class C	Cannabis, tranquilisers, some painkillers, Gamma hydroxybutyrate (GHB), Ketamine.	Up to two years in prison or an unlimited fine or both.	Up to 14 years in prison or an unlimited fine or both.

Contrast these laws in the UK for dealing narcotics with the penalties imposed against Mr. Hussain, who operated his business dealing counterfeit drugs. Four years can be a long time, particularly for someone of his age, 55. However, the penalties for counterfeit drug distribution pale in comparison with penalties for Class A and Class B drug distribution.

These laws need to be updated.

Considering that consumers who take counterfeit drugs are most often doing so without knowledge that the drugs taken could be counterfeit or dangerous, one could make a case that the pusher of counterfeit drugs needs to be punished as much as the pusher of narcotics, whose victims are at least informed about the risks they take (albeit, often influenced by addiction).

Quoting Mick Deats, Group Manager of Enforcement at the MHRA, MedicalNewsToday said,

"Counterfeit medicines are dangerous, these medicines would have found their way into high street pharmacies and onto the internet. Counterfeit medicines contain impurities, wrong ingredients and are not manufactured to the exacting standards required to safeguard public health. This is the latest in a series of successful prosecutions which should serve as a clear message to those contemplating involvement in this serious criminal activity that the MHRA is determined to take the strongest possible action against any person involved in the sale and supply of counterfeit medicines."

Mr. Deats is correct. The problem is, publicizing light punishment for lucrative enterprises could well do more harm than good.

Enforcement Roundup

Some news from around the world in the last few days concerning police busts of counterfeit rings:

• Clothing in Australia
• Counterfeit CDs and DVDs in Ireland
• A grab bag of fake goodies in my hometown of Brooklyn, NY

Plus,

• Canal Street counterfeit scammers going mobile (hat tip: Racked)

News of this kind of enforcement is nice, of course, but with counterfeiting so pervasive, continued and increased efforts on multiple fronts will continue to be needed.