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The coronavirus has completely transformed the national and global economy. With one in four small businesses reporting that they are no more than two months from permanent closure and many companies facing their toughest economic decisions yet, we all recognize the immense health and economic challenges ahead. While we are hopeful that celebrating beloved holidays with family and friends over video chat will soon be a distant memory, the way we shopped for those holidays likely reflects a fundamental shift in the way American consumers fill their pantries and American business procure supplies.
As brick-and-mortar stores reduce hours and adapt to the surge in demand for contactless pickup and delivery, the online purchasing market, seemingly omnipresent before COVID-19, has become our lifeline during this time. According to the Department of Commerce, online retail sales increased by nearly 14 percent in the second quarter of 2019. We were already buying online, but now, for our safety, we are increasingly purchasing our necessities online – groceries, cleaning supplies, cosmetics, and medicines.
Just as our favorite retailers have expanded online shopping capabilities, so have malicious counterfeiters. We’re more vulnerable than ever to fakes.
With a shortage of ways to purchase ordinary household items from trusted retailers online, and with many physical stores selling out of products moments after opening their doors, consumers are looking for a quick solution and counterfeiters are finding new ways to dupe consumers. As with traditional counterfeit sales, opportunistic sellers are hoping to trade on consumers’ trust and loyalty placed in well-known brands manufacturing products, even look-alike toilet paper presumably packaged without any safety or hygiene standards.
Household products are just the tip of the iceberg. Law enforcement officials have confiscated respirators, fake masks and gowns that fail to protect frontline workers – doctors, nurses, police officers – from the coronavirus infection. The FBI warned against fake medicines that don’t treat people’s illness – including the coronavirus. On April 1 2020, the DOJ charged a man with shipping mislabeled and unapproved fake treatments for COVID-19. Criminals are capitalizing on scams that lure in consumers—such as false companies peddling fake tests.
The global scope of physical counterfeiting is the largest it has ever been—measured at $509 billion dollars by the Organization for Economic Cooperation and Development in its 2019 report, Trends in Trade in Counterfeit and Pirated Goods, equivalent to 3.3 percent of all goods imported and exported worldwide. According to a recent Department of Homeland Security Report, mail parcel shipments containing counterfeits amount to more than 500 million packages each year. In 2018 alone, U.S. Customs and Border Protection executed 93 percent of all of its seizures of counterfeit products in small parcels.
Over the years, I’ve observed our hard-working law enforcement conduct raids on counterfeit shipments. Specialists at U.S. Ports of Entry target lead-paint-covered toys, arsenic-laden makeup, potentially explosive phone chargers, headphones and now numerous bogus health and household products flooding our borders with the promise of protecting unsuspecting consumers from COVID-19. While there are productive strategies in place, with our health on the line, there is an even greater need to implement quick solutions. We must use all available tools to prevent efforts by bad actors, foreign or domestic— to undermine the competitiveness of the U.S. economy.
We should focus on sharing pertinent information between trademark owners, law enforcement and all relevant players in the supply chain; verifying the identity of sellers; simplifying the process to register and request enforcement action; and increasing digital tools to facilitate proactive screening. When public-private partnerships executed between rights holders, express shippers, online third party marketplaces, and payment processors are strengthened, we create new tools to improve identification of bad actors and enhance enforcement.
Still, even as the U.S. government and global partners work to combat the counterfeit goods trade, the best tool we have to fight fakes is you. Learn how to identify and avoid counterfeit goods and help teach your friends and family. At GIPC, we count on these top ten tips to shop safe:
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