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Government Accountability Office - Counterfeit

A government watchdog found counterfeit items sold on sites like Amazon and Walmart

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The majority of Americans shop online at least once a year, but a government watchdog is urging consumers to be cautious after they found fake brands of popular items being sold on sites like Amazon and Walmart.

The Government Accountability Office (GAO) ordered products from five popular websites, Amazon, eBay, Walmart, Sears Marketplace and Newegg to test the authenticity of commonly purchased consumer goods, and 20 of the 47 items ordered were counterfeit.

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“I’m not telling anyone to not purchase anything online anymore, that would be unreasonable, but certainly you can look for various things that would help guard you against getting something that’s counterfeit," said Kimberly Gianopoulos, director in international affairs and trade groups at GAO, said.

GAO picked four commonly bought products, Nike Air Jordan shoes, Yeti travel mugs, Urban Decay makeup and UL certified phone chargers. All of the shoes purchased by the agency were real, and only one phone charger was counterfeit, but the makeup and mugs were a different story.

“All of the makeup we purchased was fake," said Gianopoulos.

Urban Decay cosmetics
On the left is the real Urban Decay product and on the right is the counterfeit one. GAO was able to identify the fake one because the packaging was different from the original.

A large portion of the Yeti travel mugs purchased were also fake, and according to Immigration and Customs Enforcement (ICE) data cited in the report, the fake products are at risk of containing dangerous chemicals and hazardous substances.

Yeti travel mug
The counterfeit Yeti tumbler was identified by the misspellings on the bottom of the mug.

“It’s threatening to consumers’ health and safety potentially. For example, some of the makeup that we purchased could have a variety of things in it that would be dangerous to us and we put it on our skin every day," said Gianopoulos.

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And the fake products are not only dangerous to Americans' health, but also the overall economy.

“If we purchase something and it turns out to be fake or it doesn’t work, or perhaps blows up as phones do, we would have to go out and purchase something else and then that affects potentially the U.S. companies that are trying to do business honestly,” Gianopoulos said.

Phone chargers
UL certified phone charger will include the word "listed," while the counterfeit phone chargers were missing that.

Customs and Border Protection (CBP) and ICE lead the enforcement of detecting and seizing counterfeit goods at the over 300 ports in the U.S.

Between 2012 and 2016, the number of goods seized by CBP rose by 38 percent, and the agency attributes part of this to the increased popularity of online shopping.

“It’s not like the old days where you could be walking down 7th Ave in New York and you see all the guys on the street corners trying to sell Rolex watches for $20,” said innovation consultant Paul Paetz, CEO of Innovative Disruption Inc.

“Today with online commerce, it looks just as authentic as the real thing, which makes it really hard for consumers to discern. And it isn’t just that they may be getting a defective product, often it’s painted with lead paint or maybe got some ingredients in it that aren’t completely safe to use or consume,” he continued.

Worldwide e-commerce sales are expected to reach $4 trillion by 2020, making up about 15 percent of the overall global retail spending, according to the report.

Paetz said Amazon needs to take more action against counterfeiters on their site since he considers the site “ground zero” for the criminal activity.

“It’s really incumbent of Amazon to fix this problem. It’s critical for them from a business standpoint and it isn’t just that their customers are being defrauded, it’s that it could affect their entire business and whether people trust the platform," said Paetz.

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An Amazon spokesperson told Circa News they do have an anti-counterfeiting system and they work closely with all stakeholders to protect brands.

“Our customers trust that when they make a purchase through Amazon’s website -either directly from Amazon or from one of its millions of third-party sellers – they will receive authentic products manufactured by the true manufacturer of those products

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GAO gave recommendations to CBP to enhance their efforts in finding counterfeit goods and how to work better with private companies, but Gianopoulos still urges consumers to do what they can to protect themselves from purchasing fake products.

“You can look to see if something is sold by or fulfilled by that particular website. If it’s fulfilled by that doesn’t mean that website is selling it to you, it means that they are getting the product to you, but it’s coming from a third party," said Gianopoulos.

She also recommends consumer’s always look for a customer service phone number, a possible address to return the product if needed and if the item’s price seems to good to be true, it probably is.

“It’s just important to know that while CBP and ICE are taking some steps to address this, the issue is so vast the volume of goods that are coming in these days is just amazingly high and getting things in individual packages makes it so hard for them to screen, but there are some things that both they can do and that we can do to try to address this issue of counterfeiters and maybe protect our health and safety just a little bit more," said Gianopoulos.

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