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New Study Highlights the Impacts of Counterfeiting

For those in the retail industry, the impact of counterfeit goods has been obvious. Now the numbers that demonstrate this impact are finally available thanks to the Buy Safe America Coalition’s new report, “The Counterfeit Silk Road – Impact of Counterfeit Consumer Products Smuggled into the United States.”

The study focuses on counterfeit goods from China, as more than 90.6 percent of all cargo with IPR violations comes to the U.S. from China. This ‘Counterfeit Silk Road’ has grown exponentially in recent years, as online marketplaces from Amazon, Facebook, Alibaba, and others have become a safe haven for criminals.

Buy Safe America Coalition Spokesperson and Retail Industry Leaders Association Senior Executive Vice President for Public Affairs Michael Hanson says that because Amazon, Facebook, and others do not adequately verify sellers, there is no way to prevent criminal activity on their sites. Oftentimes, when retailers discover that a seller on Amazon is engaging in illegal activity, Amazon shirks responsibility, claiming they have no info on who the seller actually is.

Michael Hanson

“This is the whole reason behind the push for the INFORM Consumers Act, to require they verify who the seller is,” Hanson said. “eBay and Etsy have endorsed the Act, so there’s no technological reason or burden keeping Amazon from doing the same. Why is Amazon still out on an island by itself not wanting to provide accountability?”

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An estimated $44.3 billion in illicit cargo that doesn’t fall under the umbrella of narcotics, people, and tobacco is escaping detection as it comes into the United States, according to the study. These lost sales mean that more than 39,860 jobs in wholesaling and nearly 283,400 retail jobs are lost due to the impact of counterfeit goods. These goods also cost the U.S. government nearly $7.2 billion in personal and business tax revenues.

Counterfeit goods can be dangerous for consumers, too, Hanson points out. From substandard PPE masks that don’t actually protect against COVID-19, to water filters that add chemicals to drinking water, to even brake pads and airbags that simply don’t work, counterfeit products can be life-threatening.

“This is a real problem, and people need to let lawmakers know there are harmful effects in the community, and ask them to respond,” Hanson said.

Find the full free report from the Buy Safe America Coalition here.

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