Consequences of buying counterfeit goods - A doorway to criminal activities

Counterfeit products have become a major threat to various global industries, not limiting to fashion-oriented goods & items. With the advent and boom of e-commerce businesses, it has now seeped into a large market segment of baby & food products, pharmaceuticals, and commodities used in automation/transportation.?

To a regular consumer, it may seem a fair deal to buy goods and items at incredible prices as advertised. However, it incurs massive adverse effects on almost every aspect of our lives. It might seem like a victimless action to buy counterfeit products at a low cost, but the consequences are colossal. Anything bought from a fake factory, the money generated goes around and comes to harm you in hindsight — financially, physically, and mentally.?

We have boiled down some of the major consequences of buying counterfeit goods here and how it is all connected to your life.?

1. Harmful to the Environment

Counterfeit products are manufactured from harmful substances and chemicals which are not subjected to pass the health and safety standards. Therefore, when consumed, they can result in deteriorating health & wellbeing and raising safety concerns — even to the extent of deaths in some cases

Moreover, the usage of sub-standard resources used in the manufacture of these counterfeits results in harming nature, as the waste generated is not properly disposed of. This leads to the contamination of water bodies and land, which in turn is consumed by us humans to have an adverse effect on our health.?

Collectively, buying any counterfeit product just not causes harm to consumers’ health but also to the environment, thus affecting the food chain.?

2. Promotes Slave Labour and Human Trafficking

Buying counterfeits from flea markets, social media individuals, online marketplaces, or street vendors are directly associated with exploiting human resources. Any products bought from these platforms are manufactured under the illegal jurisdiction of crooks. Moreover, people manufacturing these items are subjected to harsh slavery with little or no compensation for their work.?

Usually, the developing countries, due to cheap labour costs, involve child labour practices to manufacture these goods & items. That has a direct impact on the world economy promoting human trafficking and depriving education. Eventually, the governments are bound to spend huge sums of money to curb these illegal practises, enforcing additional costs for security and tracing systems, litigation, and civil enforcement that are to be incurred by the working class.

3. Creates Funding for Organised Crime, Black Market, and Terrorism?

The manufacturers of counterfeit items and goods are supported by huge powerful government sneaking organisations that support illegal activities underneath. These organisations have clusters that are interconnected to the criminal world.?

Buying a fake product or first-copies leads funds these organisations which makes them heftier than ever to conduct massive terror operations, leading to loss of life and resources. This makes them huge sums of money as they claim their products to be marginally cheaper than authentic ones. But in reality, there lies a huge gap between what is stated and the cost of manufacture.?

The same is addressed by the Counterfeit Investigator Alastair Gray, who talks about how a single Counterfeit Polo T-shirt you buy is supporting and promoting the next bombing attack in your city.?

These instances highlight the use of money generated from counterfeit goods used in terror attacks or linked to terrorism -?

The 2015 Charlie Hebdo Terror attack in Paris was found to be financed partially by counterfeit sportswear.?

The Madrid Train bombings in 2004 were proceeded by illicit income received from the sale of pirated goods.

It is also found that International Terror Organisations like Al-Qaeda, Lashkar-e-Taiba, and the Irish Republic Army received their illicit income from the illegal cigarette trade and counterfeit apparel.?

4. Plays with Consumer Safety

All counterfeit products are produced and manufactured in unregulated conditions that make use of low-quality materials. The manufacturing of these products does not go through mandatory quality-checks to ensure safety and health standards. Various fake products such as medicines, baby products, automobile parts, and consumer electronics are made of low-standard materials that put the user at risk leading to health and safety dangers.?

The consumption and use of any of these products put the life of people in danger and can lead to fatal deaths. Prime examples of mishappenings caused by the usage of counterfeit products are short-circuiting or blasts in consumer electronics such as hair dryers and smartphones. Another example is a fake Colgate toothpaste found in 2007 which had ingredients such as diethylene glycol — a toxic substitute to Fluoride.

As per the reports released by the International Alliance for Responsible Drinking (IARD) , the distribution and consumption of illicit alcohol have a fair share of recorded deaths over the years. Here are some of the horrifying instances of fatalities caused due to the consumption of illicit alcohol from around the world -?

1. In 2018, Indonesian police seized high volumes of alcohol that contained mosquito repellents and cough medicine, which led to 141 fatalities.?
2. Libya prohibits the distribution and consumption of alcohol. However, unrecorded and illegal production and distribution of alcohol is a common observance. As a result, sometimes, these illegal producers add methanol to the home-distilled drink Bokha to increase its alcoholic concentration. This gave the window to counterfeit producers to supply a tainted batch of fake methanol substituted Bokha, resulting in more than 100 deaths and over 1000 hospitalisations; out of which 15% lost their sight.?
3. A far more devastating case of methanol poisoning was reported by Guardian, finding over 1200 deaths caused only in the first nine months of 2016.
4. A recent case of illicit alcohol in Turkey, as reported by securingindustry.com has claimed 50 lives in December 2021, and the numbers are spiking.

5. Inhibits Innovation

When consumers are appealed to buy counterfeit products at unbelievably low prices, the original brands are left with no room for genuine market feedback and new innovations. This hinders the growth and development of new products in the market that were supposed to serve the consumer for their good. The sale of counterfeits over original products inhibits the innovations and even leads to the discontinuation of renowned products, discouraging innovators.?

In 2020 alone, as per the Statista data analysis, the clothing brands incurred a 26.3 billion Euro sales loss due to counterfeit clothing products, and the Pharmaceutical Industry incurred a 10.3 billion Euro Sales loss.?

6. Leads to Unemployment

Counterfeiting spoils a brand’s reputation and lowers the consumer trust in the brand, because they ought to buy products in the name of brand names and the quality offered. However, later when they find out the product to be faulty or damaged or causing ramifications, they unknowingly hold the brand responsible for its authenticity.?

This substantially leads to missed sales opportunities by genuine retailers selling legitimate products, thus negatively impacting the manufacturing and sales, which eventually leads to loss of income of employees or in some cases even jobs.?

On that note, according to the International Chamber of Commerce , it is estimated that the global economic impact of counterfeiting is supposed to reach $4.2 trillion, and can put 5.4 million legitimate jobs at risk over this time period.?

In worst cases, it may also occur the discontinuance of the product that sets a dead end for the workers specialised in the manufacturing of a particular product. And that has a massive impact on a country’s economy. Because then every ounce of money is inflected towards fake factories & organisations circumventing the national customs and duties taxes.