Counterfeiting may seem like something reserved for third-world countries and spy movies, but counterfeit scams are huge worldwide and cost companies and their customers millions of dollars each year. Counterfeiting is particularly lucrative in luxury goods such as shoes, bags, and electronics, with China coming in at number one in the world for seizures of counterfeit goods.
You may think that buying a knockoff Louis Vuitton on Canal Street in New York, or getting a Prada bag at a 70 percent off on a discount website is a victimless crime, but the fact is that counterfeiting is closely tied with human rights violations, child labor, and terrorism. That’s right—every time you buy a knock-off, the terrorists win.
Law enforcement has had quite a bit of success cracking down on major counterfeit scams, particularly lately, and has stopped millions of dollars in counterfeit goods from reaching the public. Here are five of the biggest counterfeit busts this year.
Earlier this week, customs agents seized over 20,000 pairs of knock-off Christian Louboutin shoes in Los Angeles, complete with the designer’s distinctive red soles, which are coveted by fashionistas worldwide. The knock-offs, which were shipped from China, would have been sold through discount outlets to customers assuming they were legitimate. The five shipments that were intercepted were worth an estimated $18 million if they’d reached consumers.
If you’ve ever read a wine menu in a nice restaurant, you know that wine can be incredibly expensive—running into the hundreds or thousands of dollars a bottle for certain rare vintages. Rudy Kurniawan, a collector of fine wines from Burgundy, bought and sold tens of millions of dollars of wine throughout the early aughts, but not all of his transactions were legit. It wasn’t until Kurniawan attempted to sell a great deal of a particular wine (that shouldn’t have existed because it wasn’t made during the years it was labeled) that he was found out. The FBI arrested him in March and charged Kurniawan with multiple counts of fraud. Agents also found a counterfeiting factory in his home with evidence that he had been selling millions of dollars in counterfeit wines to collectors worldwide. Vanity Fair reports that it may be the largest case of wine fraud in history.
Counterfeit fraud doesn’t always involve fake goods. A couple in Bean Station, Tennessee, were arrested last month after an eight-month investigation revealed they were using technology to create counterfeit identification cards and payroll checks. They used the fake documents to buy Walmart gift cards at Sam’s Club, which were then spent on at least a million dollars worth of goods at Walmart to be re-sold online. The couple faces not just fraud charges, but tax evasion, money laundering, and theft.
Fake iPhone Covers
It’s been a big summer for seizures of counterfeit goods—in July, U.S. Customs officers seized millions in fake Apple products from a shipment arriving in Texas from China. The shipments contained cases designed for several models of Apple and Samsung phones, but the cases had inserts that made them look like Apple products. All told, 281 cartons were seized, with products worth over $4 million.
Meanwhile in Phoenix, three women were arrested for what is thought to be the biggest counterfeit coupon scam in U.S. history. It turns out that the ladies in question allegedly copied original manufacturer’s coupons, which they sold on eBay and the “savvy shopper” website belonging to one of the women. The coupons, which offered huge discounts, cost manufacturers tens of millions of dollars in losses. The women are facing charges including counterfeiting, fraud, forgery, and operating a criminal enterprise. It brings a whole new meaning to the term “extreme couponing.”