Italian counterfeiters moving down-market in recession

Italian counterfeiters are expanding into personal care to target budget-conscious consumers, a report found.

The rise of fake soaps, shampoos and other personal care products comes as households in Italy contend with falling disposable incomes. Spotting an opportunity, Italian counterfeiters have expanded beyond luxury labels and into day-to-day personal care and cosmetic products.

Counterfeit cosmetics sales have increased 15-fold over the past decade, making it the fastest growing sector, Italian trade association UNIPRO said. The rise is having a detrimental impact on the fragile Italian economy.

A report by Rome-based think tank Censis estimates counterfeiting costs Italy €1.7bn ($2.2bn) in missed tax revenues in 2010. "The impact of counterfeiting on the economy is huge," Censis said.

Clothing, accessories and software account for much of the estimated €6.9bn worth of fakes sold in 2010. Other sectors are on the rise though, with fake food worth an estimated €1.1bn.

"This is a global fraud that must be stopped," agriculture and food lobby group Coldiretti said.