Unregistered
02-11-2006, 06:41 AM
Now we move on to a scam that has spread all over the country, maybe even to your own town. Have you ever wondered how flea markets, bargain stores and street vendors can sell merchandise with a famous designer name on it dirt cheap? We have even heard of house parties where handbags that look just like the ones that sell for $1,500 in a boutique go for $20 or $30.
Well, the merchandise, it turns out, is counterfeit, knockoffs, that some people can't tell from the real thing, except, of course, for the price. But what you may not realize is the criminal, possibly even terrorist, connection to those bargain bags.
Consumer correspondent Greg Hunter has tonight's "Eye Opener."
(BEGIN VIDEOTAPE)
HUNTER: Louis Vuitton, Gucci, Prada, and Christian Dior. If you're looking for a bargain, you won't find one here. High-end fashion powerhouses like these are known for peddling top-of-the-line goods and charging top dollar, from the runway to the red carpet.
UNIDENTIFIED FEMALE: Who did your dress?
UNIDENTIFIED FEMALE: This is Giorgio Armani.
HUNTER: Luxury brand names have become the ultimate status symbol. We use them to define ourselves, a need reflected in pop culture, in TV shows like "Sex and the City."
(BEGIN VIDEO CLIP, "SEX AND THE CITY")
SARAH JESSICA PARKER, ACTRESS: The Birkin bag. Really? That's not even your style.
KIM CATTRALL, ACTRESS: Oh, honey, it is not so much the style. It is what carrying it means.
PARKER: It means you're out 4,000 bucks.
CATTRALL: Exactly. When I'm tooling around town with that bag, I will know I have made it.
(END VIDEO CLIP)
HUNTER: And getting your hands on a designer must-have doesn't come cheap. A Burberry wool scarf will run you $50 -- a pair of Prada pumps, 850 bucks -- and a Christian Dior handbag, nearly $3,000.
But what if you can't afford the real thing? Welcome to the underground world of knockoffs, look-alikes, and fashion fakes, all brought to you by our hidden camera investigation.
This is the seamy side of Chinatown in New York City, where counterfeit luxury goods cost a fraction of what you would pay for the real thing. And you won't believe the secret world we walked into. So, what is the harm in getting a good deal, right?
UNIDENTIFIED FEMALE: How much are you going to charge me for this?
HUNTER: The answer may surprise you.
MARTIN FICKE, SPECIAL AGENT IN CHARGE, DEPARTMENT OF HOMELAND SECURITY'S IMMIGRATION AND CUSTOMS ENFORCEMENT IN NEW YORK: We have got plenty of examples of cases where money is being sent to areas of the world that are of much concern to the United States, as it relates to terrorist activity.
HUNTER: Martin Ficke is the top investigator for Homeland Security in New York City. He says trafficking counterfeit products is a $250-billion-a-year criminal business in America. Some of that is fakes like these.
So, what happens to the illegally generated money? Some of it is sent out of the country to crooks and possibly terrorists.
UNIDENTIFIED FEMALE: Thank you.
HUNTER (on camera): Al Qaeda could end up with profits from counterfeit bags?
FICKE: Yes, they could. Yes, they could. And I -- I -- I think that people should think about that when they're out there buying counterfeit merchandise. It may seem like it is a victimless crime, but, clearly, from our perspective, it is not.
HUNTER (voice-over): And, Ficke says, that counterfeit fashion profits also fund other organized crime, such as drugs, prostitution and human trafficking.
The private security investigator you see here has agreed to give us a behind-the-scenes look at what is really going on.
UNIDENTIFIED FEMALE: I see Chanel.
HUNTER: Luxury good companies hire people like her to catch counterfeiters. Gucci, Chanel, Prada, Louis, all the big labels, and, our experts say, all knockoffs.
UNIDENTIFIED FEMALE: Oh, Prada.
HUNTER: And in secret showroom...
UNIDENTIFIED FEMALE: Make a left and then go upstairs, OK?
(CROSSTALK)
UNIDENTIFIED FEMALE: Make a left and then go upstairs?
HUNTER: ... after showroom, we saw vendors eager to make a sale.
UNIDENTIFIED FEMALE: You should be giving that to me for $30.
UNIDENTIFIED FEMALE: Lose money.
(LAUGHTER)
UNIDENTIFIED FEMALE: You lose money. That's not my problem.
HUNTER: And take our money.
UNIDENTIFIED FEMALE: Forty-two, OK?
UNIDENTIFIED FEMALE: Forty.
UNIDENTIFIED FEMALE: OK. Sure.
HUNTER (on camera): This isn't like going shopping at your local mall. We are going to go down a secret passageway here.
ANDREW OBERFELDT, PRESIDENT, ABACUS INVESTIGATIONS & SECURITY INC.: There is nothing in there that is legal to sell. And that's why that is a secret. And that's how you know they know what they're doing, because all of the stuff that is legal to sell is outside of that secret showroom.
HUNTER (voice-over): Andrew Oberfeldt, a former NYPD-detective- turned-private-investigator, helps luxury companies protect their brands by getting these copycats off the streets.
(on camera): Selling counterfeit goods is a crime.
OBERFELDT: Right. It is a felony. It is a -- a serious crime. If it was legal and OK, why are they all sneaking around doing it?
HUNTER: But, if you buy it, it is not a felony.
OBERFELDT: Not yet. We're working on that.
UNIDENTIFIED FEMALE: No, we have it.
HUNTER (voice-over): The reality is, right now, it is not a crime of any kind to buy a knockoff. We had no problem buying any counterfeit bag we wanted, whether it was a secret showroom or making a deal right on the street, Prada, Chanel, Louis Vuitton, Gucci, all bought within two hours, for a fraction of what the real thing would cost.
And even though you buy knockoffs dirt cheap, crooks rake in huge profits. If caught, the chance of these criminals doing any jail time is slim to none.
OBERFELDT: The profit of selling counterfeit goods is exactly the same, if not more, than selling drugs.
HUNTER (on camera): You're telling me that some guy selling counterfeit purses makes as much as some guy selling heroin?
OBERFELDT: Yes. Yes. I don't know why anybody sells heroin anymore. They must be stupid.
HUNTER (voice-over): We decided to go back to Canal Street, this time with no hidden camera. We had a few questions for the places that sold our undercover people the counterfeit bags.
UNIDENTIFIED FEMALE: (INAUDIBLE)
UNIDENTIFIED MALE: Come on. (INAUDIBLE)
HUNTER: They weren't eager to talk, like this guy, who closed his shop when he saw us coming.
(on camera): Are you selling counterfeit goods?
(voice-over): And in store... (on camera): Do you sell counterfeit bags? No?
(voice-over): ... after store, the answer was the same. Everyone told us they didn't sell counterfeit products.
UNIDENTIFIED MALE: No, no counterfeit bag here.
(CROSSTALK)
UNIDENTIFIED MALE: Everything is good.
HUNTER: So, where do all the counterfeits come from?
Most are shipped to the United States in 40-foot containers to places like Port Elizabeth, New Jersey.
(on camera): I'm inside a steel shipping container. Just one of these things, filled to the brim, say, with fake Louis Vuitton bags, could mean as much as $2 million to $4 million to the counterfeiter.
(voice-over): It is Customs and Border Protection's job to try to stop things like bogus bags before they hit the streets, a mammoth job, considering, each year, 2.3 million of these containers come through this port alone. That's more than 6,000 containers each and every day.
(on camera): No way, you could physically inspect each one of them?
LORRAINE SPINA, CUSTOMS AND BORDER PROTECTION: Each container is examined in one way, shape or form, like I said, either electronically or physically, depending upon the circumstances.
HUNTER: The day we were there, officers were unpacking shipments of seized handbags. To the untrained eye, some look like the real thing, but, no matter how good they look, buying counterfeit products really comes down to a simple question of what is right and what's wrong.
OBERFELDT: It is wrong. It is wrong to take somebody else's stuff. That's -- we all learn that in grade school. You know, if it is not yours, you don't take it.
(END VIDEOTAPE)
ZAHN: So, Greg, you look at these pictures on TV, and the merchandise looks authentic.
(CROSSTALK)
ZAHN: So, what is the immediate dead giveaway that things are a knockoff?
HUNTER: Well, for example, they put this plastic -- this is a Birkin bag, thousands of dollars. And they try to really make it look real, like this lock really works good. But this is supposed to be... ZAHN: And this looks like the enclosure that the...
HUNTER: That's right.
ZAHN: ... $5,000 one has, right?
HUNTER: And this is supposed to be a durable bag, but, you know, the last time I checked, this durable bag wouldn't be made out of plastic that you could do this. This is supposed to be, like, alligator or some exotic, tough skin, right?
ZAHN: So...
HUNTER: Piece of junk.
ZAHN: So...
HUNTER: Plastic.
ZAHN: So, this one is a little more obvious than some of the other ones.
(CROSSTALK)
HUNTER: It is with a razor blade. But it looks pretty good.
In the wintertime, these things get really tough, OK? So -- and, then, they really go through great lengths to make them look special, like this Louis Vuitton bag. It had "Louis Vuitton" on the outside, and you look here, and -- and this is a plastic handle. And it would never be covered with this.
And this is a plastic handle with painted-on junk. And, then, check out this zipper. This is supposed to be an expensive bag.
ZAHN: I get it. It's a piece of junk.
HUNTER: Piece of junk.
ZAHN: All right.
HUNTER: Plastic. And...
(CROSSTALK)
ZAHN: ... last two down there?
HUNTER: OK, last two. And this is all about the labels, right?
So, we have, you know, Kate Spade label. Never -- never will do that. Prada label -- it would never do that. I mean, the Prada label is -- you -- you would have to get a screwdriver and a hammer to pull it off. These things are on there. And, of course...
ZAHN: And, once again, this is supposed to be leather, right?
HUNTER: This is supposed to be some leather.
And, you know...
ZAHN: Ouch.
HUNTER: See? It is just foam rubber and plastic right here.
ZAHN: Buyer beware.
HUNTER: Just junk.
ZAHN: It is amazing what a big business this is, though.
HUNTER: It is huge. Why sell drugs? Sell this.
Don't buy it.
ZAHN: More profitable, as your investigator told you.
HUNTER: That's right. But don't buy it. Don't buy it.
ZAHN: Thank you for the very smart investigation.
HUNTER: Thank you.
ZAHN: Just remember, once again, if you buy one of those on the street, you could, potentially, be helping terrorists.
HUNTER: You're helping crooks, for sure.
ZAHN: Greg Hunter, again, thanks.
Well, the merchandise, it turns out, is counterfeit, knockoffs, that some people can't tell from the real thing, except, of course, for the price. But what you may not realize is the criminal, possibly even terrorist, connection to those bargain bags.
Consumer correspondent Greg Hunter has tonight's "Eye Opener."
(BEGIN VIDEOTAPE)
HUNTER: Louis Vuitton, Gucci, Prada, and Christian Dior. If you're looking for a bargain, you won't find one here. High-end fashion powerhouses like these are known for peddling top-of-the-line goods and charging top dollar, from the runway to the red carpet.
UNIDENTIFIED FEMALE: Who did your dress?
UNIDENTIFIED FEMALE: This is Giorgio Armani.
HUNTER: Luxury brand names have become the ultimate status symbol. We use them to define ourselves, a need reflected in pop culture, in TV shows like "Sex and the City."
(BEGIN VIDEO CLIP, "SEX AND THE CITY")
SARAH JESSICA PARKER, ACTRESS: The Birkin bag. Really? That's not even your style.
KIM CATTRALL, ACTRESS: Oh, honey, it is not so much the style. It is what carrying it means.
PARKER: It means you're out 4,000 bucks.
CATTRALL: Exactly. When I'm tooling around town with that bag, I will know I have made it.
(END VIDEO CLIP)
HUNTER: And getting your hands on a designer must-have doesn't come cheap. A Burberry wool scarf will run you $50 -- a pair of Prada pumps, 850 bucks -- and a Christian Dior handbag, nearly $3,000.
But what if you can't afford the real thing? Welcome to the underground world of knockoffs, look-alikes, and fashion fakes, all brought to you by our hidden camera investigation.
This is the seamy side of Chinatown in New York City, where counterfeit luxury goods cost a fraction of what you would pay for the real thing. And you won't believe the secret world we walked into. So, what is the harm in getting a good deal, right?
UNIDENTIFIED FEMALE: How much are you going to charge me for this?
HUNTER: The answer may surprise you.
MARTIN FICKE, SPECIAL AGENT IN CHARGE, DEPARTMENT OF HOMELAND SECURITY'S IMMIGRATION AND CUSTOMS ENFORCEMENT IN NEW YORK: We have got plenty of examples of cases where money is being sent to areas of the world that are of much concern to the United States, as it relates to terrorist activity.
HUNTER: Martin Ficke is the top investigator for Homeland Security in New York City. He says trafficking counterfeit products is a $250-billion-a-year criminal business in America. Some of that is fakes like these.
So, what happens to the illegally generated money? Some of it is sent out of the country to crooks and possibly terrorists.
UNIDENTIFIED FEMALE: Thank you.
HUNTER (on camera): Al Qaeda could end up with profits from counterfeit bags?
FICKE: Yes, they could. Yes, they could. And I -- I -- I think that people should think about that when they're out there buying counterfeit merchandise. It may seem like it is a victimless crime, but, clearly, from our perspective, it is not.
HUNTER (voice-over): And, Ficke says, that counterfeit fashion profits also fund other organized crime, such as drugs, prostitution and human trafficking.
The private security investigator you see here has agreed to give us a behind-the-scenes look at what is really going on.
UNIDENTIFIED FEMALE: I see Chanel.
HUNTER: Luxury good companies hire people like her to catch counterfeiters. Gucci, Chanel, Prada, Louis, all the big labels, and, our experts say, all knockoffs.
UNIDENTIFIED FEMALE: Oh, Prada.
HUNTER: And in secret showroom...
UNIDENTIFIED FEMALE: Make a left and then go upstairs, OK?
(CROSSTALK)
UNIDENTIFIED FEMALE: Make a left and then go upstairs?
HUNTER: ... after showroom, we saw vendors eager to make a sale.
UNIDENTIFIED FEMALE: You should be giving that to me for $30.
UNIDENTIFIED FEMALE: Lose money.
(LAUGHTER)
UNIDENTIFIED FEMALE: You lose money. That's not my problem.
HUNTER: And take our money.
UNIDENTIFIED FEMALE: Forty-two, OK?
UNIDENTIFIED FEMALE: Forty.
UNIDENTIFIED FEMALE: OK. Sure.
HUNTER (on camera): This isn't like going shopping at your local mall. We are going to go down a secret passageway here.
ANDREW OBERFELDT, PRESIDENT, ABACUS INVESTIGATIONS & SECURITY INC.: There is nothing in there that is legal to sell. And that's why that is a secret. And that's how you know they know what they're doing, because all of the stuff that is legal to sell is outside of that secret showroom.
HUNTER (voice-over): Andrew Oberfeldt, a former NYPD-detective- turned-private-investigator, helps luxury companies protect their brands by getting these copycats off the streets.
(on camera): Selling counterfeit goods is a crime.
OBERFELDT: Right. It is a felony. It is a -- a serious crime. If it was legal and OK, why are they all sneaking around doing it?
HUNTER: But, if you buy it, it is not a felony.
OBERFELDT: Not yet. We're working on that.
UNIDENTIFIED FEMALE: No, we have it.
HUNTER (voice-over): The reality is, right now, it is not a crime of any kind to buy a knockoff. We had no problem buying any counterfeit bag we wanted, whether it was a secret showroom or making a deal right on the street, Prada, Chanel, Louis Vuitton, Gucci, all bought within two hours, for a fraction of what the real thing would cost.
And even though you buy knockoffs dirt cheap, crooks rake in huge profits. If caught, the chance of these criminals doing any jail time is slim to none.
OBERFELDT: The profit of selling counterfeit goods is exactly the same, if not more, than selling drugs.
HUNTER (on camera): You're telling me that some guy selling counterfeit purses makes as much as some guy selling heroin?
OBERFELDT: Yes. Yes. I don't know why anybody sells heroin anymore. They must be stupid.
HUNTER (voice-over): We decided to go back to Canal Street, this time with no hidden camera. We had a few questions for the places that sold our undercover people the counterfeit bags.
UNIDENTIFIED FEMALE: (INAUDIBLE)
UNIDENTIFIED MALE: Come on. (INAUDIBLE)
HUNTER: They weren't eager to talk, like this guy, who closed his shop when he saw us coming.
(on camera): Are you selling counterfeit goods?
(voice-over): And in store... (on camera): Do you sell counterfeit bags? No?
(voice-over): ... after store, the answer was the same. Everyone told us they didn't sell counterfeit products.
UNIDENTIFIED MALE: No, no counterfeit bag here.
(CROSSTALK)
UNIDENTIFIED MALE: Everything is good.
HUNTER: So, where do all the counterfeits come from?
Most are shipped to the United States in 40-foot containers to places like Port Elizabeth, New Jersey.
(on camera): I'm inside a steel shipping container. Just one of these things, filled to the brim, say, with fake Louis Vuitton bags, could mean as much as $2 million to $4 million to the counterfeiter.
(voice-over): It is Customs and Border Protection's job to try to stop things like bogus bags before they hit the streets, a mammoth job, considering, each year, 2.3 million of these containers come through this port alone. That's more than 6,000 containers each and every day.
(on camera): No way, you could physically inspect each one of them?
LORRAINE SPINA, CUSTOMS AND BORDER PROTECTION: Each container is examined in one way, shape or form, like I said, either electronically or physically, depending upon the circumstances.
HUNTER: The day we were there, officers were unpacking shipments of seized handbags. To the untrained eye, some look like the real thing, but, no matter how good they look, buying counterfeit products really comes down to a simple question of what is right and what's wrong.
OBERFELDT: It is wrong. It is wrong to take somebody else's stuff. That's -- we all learn that in grade school. You know, if it is not yours, you don't take it.
(END VIDEOTAPE)
ZAHN: So, Greg, you look at these pictures on TV, and the merchandise looks authentic.
(CROSSTALK)
ZAHN: So, what is the immediate dead giveaway that things are a knockoff?
HUNTER: Well, for example, they put this plastic -- this is a Birkin bag, thousands of dollars. And they try to really make it look real, like this lock really works good. But this is supposed to be... ZAHN: And this looks like the enclosure that the...
HUNTER: That's right.
ZAHN: ... $5,000 one has, right?
HUNTER: And this is supposed to be a durable bag, but, you know, the last time I checked, this durable bag wouldn't be made out of plastic that you could do this. This is supposed to be, like, alligator or some exotic, tough skin, right?
ZAHN: So...
HUNTER: Piece of junk.
ZAHN: So...
HUNTER: Plastic.
ZAHN: So, this one is a little more obvious than some of the other ones.
(CROSSTALK)
HUNTER: It is with a razor blade. But it looks pretty good.
In the wintertime, these things get really tough, OK? So -- and, then, they really go through great lengths to make them look special, like this Louis Vuitton bag. It had "Louis Vuitton" on the outside, and you look here, and -- and this is a plastic handle. And it would never be covered with this.
And this is a plastic handle with painted-on junk. And, then, check out this zipper. This is supposed to be an expensive bag.
ZAHN: I get it. It's a piece of junk.
HUNTER: Piece of junk.
ZAHN: All right.
HUNTER: Plastic. And...
(CROSSTALK)
ZAHN: ... last two down there?
HUNTER: OK, last two. And this is all about the labels, right?
So, we have, you know, Kate Spade label. Never -- never will do that. Prada label -- it would never do that. I mean, the Prada label is -- you -- you would have to get a screwdriver and a hammer to pull it off. These things are on there. And, of course...
ZAHN: And, once again, this is supposed to be leather, right?
HUNTER: This is supposed to be some leather.
And, you know...
ZAHN: Ouch.
HUNTER: See? It is just foam rubber and plastic right here.
ZAHN: Buyer beware.
HUNTER: Just junk.
ZAHN: It is amazing what a big business this is, though.
HUNTER: It is huge. Why sell drugs? Sell this.
Don't buy it.
ZAHN: More profitable, as your investigator told you.
HUNTER: That's right. But don't buy it. Don't buy it.
ZAHN: Thank you for the very smart investigation.
HUNTER: Thank you.
ZAHN: Just remember, once again, if you buy one of those on the street, you could, potentially, be helping terrorists.
HUNTER: You're helping crooks, for sure.
ZAHN: Greg Hunter, again, thanks.