Congressional hearing hears of counterfeit fight challenges

E-commerce, 3D printing, the dark web and virtual currencies such as Bitcoin are some of the major challenges in the fight against counterfeit goods, according to US Immigration and Customs Enforcement's top enforcer.

Bruce Foucart, director of the ICE-led National Intellectual Property Rights Coordination Center (IPR Centre told a Senate Committee on the Judiciary hearing that the illegal trade in counterfeit products poses "a significant and growing threat to health and safety."

Recent investigations by ICE have uncovered fake lithium batteries that are not properly vented, airbags with too much propellant, jewelry that contains lead, pharmaceuticals that contain potentially toxic substances, and health and beauty products that made under unsanitary conditions, he told the committee.

"Our biggest challenge is that criminals are willing to counterfeit and market any product that will sell, regardless of whether it could result in serious and significant injury to consumers or the public."

Foucart was part of an expert panel that also included representatives of the US Patent and Trademark Office and Global Intellectual Property Center (GIPC) along with executives from two companies affected by counterfeiting - Proctor & Gamble and Revision Military.

Committee leadership acknowledged that counterfeiting is a worldwide problem that impacts American business, presents health and safety hazards and funds criminal organizations, and that the growth of the Internet has created new opportunities to deceive consumers. Members challenged the panel to provide solutions to the growing problem of IP theft.

In response, Foucart said IP enforcement training and education for local and state law-enforcement agencies was key to minimizing counterfeiting, citing a recent public service announcement that brought together federal and state organizations to highlight the threat of IP theft.

He also referenced a successful joint initiative between ICE's Homeland Security Investigations (HSI) and Department of Defense (DoD) investigative agencies - Operation Chain Reaction - in which a suspect was sentenced to three years in federal prison for selling counterfeit goods to the military.

Enhanced coordination between federal agencies is leading to quality seizures and arrests, he asserted. Operation Plastic Beauty - focusing on counterfeit healthcare and beauty products such as shampoo, toothpaste, makeup, and lip balm - resulted in 18 arrests, 19 indictments, 19 convictions, and the seizure of goods valued at over $7m last year.

"The IPR Centre's mission is to address the theft of innovation that threatens US economic stability and national security, undermines the competitiveness of US industry in world markets, and places the public's health and safety at risk," said Foucart.

"Law enforcement, public education, demand reduction and global collaboration are all critical to successfully address this crime."