Imitation Nation

Operation Pangea 17 from Interpol was released. See this fancy graphic.

Sven looked back at the previous 10 years of Operation Pangea and these results are record breaking by any measure.

• 50.4 million doses of illicit pharmaceuticals worth USD 65 million. The largest operation to date had been $11 million in illicit medicines.

• Arrest of 769 suspects and the dismantling of 123 criminal groups worldwide.

• In total, law enforcement agencies worldwide launched 1,728 investigations and issued 847 search warrants targeting criminal networks engaged in the illicit distribution of pharmaceutical products. 93 per cent of the illicit pharmaceuticals seized lacked regulatory approvals from national health authorities.

This trend is being driven by the widespread promotion and availability of these medicines across social media and online marketplaces, creating lucrative and relatively low-risk opportunities for criminal networks selling low-quality or counterfeit products.

Lululemon is suing Costco over design patent infringement of several of their clothing products. While you could read the suit yourself, we recommend this video from fashion designer Joe Ng that explains the types of patents you can have, and how trade dress works. Joe Ng says the craftsmanship is not as good on the Costco product.

China is now entering the world of IP protection because their brands are fighting off fakes. China has brands and now Intellectual Property to protect! Phones by Huawei, Drones by DJI, My favorite portable batteries from Anker, and New electric cars from BYD.

According to the OECD, China remains the source of most counterfeits in the world, so this could be a very topsy turvy time. Our bottom line is that there’s never bad news in adding a new ally country to the world of brand protection.

Quick news hits:

• 9 great documentaries on counterfeits and illegal trade from Factual America

• Issues in the fake wine world in Bill Koch’s cellar

• Chinese controlled counterfeit gang busted.

Tom’s hardware review ran an article this week about a chinese pc repair shop that received four of these, and upon closer examination, three of them were fake and unrepairable and unusable. They had modified older cards and in some cases attached other parts to give the appearance of the 4090 unit but the fake one was still inoperable which you would have discovered the moment you plugged it in.

StockX has reported it rejected nearly $10 million worth of counterfeit sneakers last year as part of a comprehensive report outlining its efforts on verification, fraud prevention and anti-counterfeiting in 2024. The resale platform's "Brand Protection and Consumer Trust" report consists of 19 pages detailing the measures it takes to ensure it delivers authentic product to consumers. Over the course of 2024, StockX rejected more than 30,000 sneakers alone suspected of being counterfeit. Suspected fakes are the second most common reason for products being rejected, accounting for 22 percent of total products rejected. 32 percent of items were rejected for defects, while 12 percent were found to be used and another 7 percent came in a damaged box.

We are following this new case of Audi AG v. CarParts.com, Inc., 1:25-cv-04940 (S.D.N.Y.), in which Audi asserts that CarParts.com is selling copies of their goods using their trademarks, including proprietary OEM numbers. We think it’s also interesting that the EU Court of Justice also found that selling grills without the Audi logo, but that have a cutout that fits the logo, is also trademark infringement.

Quick news hits:

Another fake money scheme in Florida, where four men obtained $100 fake bills made by bleaching $10 bills and printing the $100 bill over the same material. You could still see Hamilton’s face in the watermark, which tipped off a grocery cashier.

Labubu dolls are a hot item, which means counterfeits are being made and China just shut down a factory making them. As a response the other factories making fakes appear to have shut down operations and gone dark to avoid getting caught.

Back on the fake stamps beat, the US Postal Service filed and obtained a temporary restraining order against two shipping companies New York and Los Angeles who are accused of using fake USPS shipping labels to ship merchandise for Chinese customers through the US Postal service…for years.

PSM released a report this week on fishy freight shipments of medicine into the country, using data we pulled from the FDA’s medical freight shipments database. We are finding two kinds of fraud here. First, we’re seeing shipping manifests where the manufacturer listed on the report is not an FDA-registered entity, which means it’s been made in a facility never inspected by the FDA. Which means it’s illegal to enter the country.

Second is that we’re seeing people misdeclare the product code on an item to evade interdiction.  We found two Schedule 1 controlled substances, mescaline and LSD, coded as anti-depressants and antibiotics. The codes said antidepressant, but the description in text said LSD.  I’m guessing they just have machine scanning of codes and are not even looking at the text.

Third, a Florida district judge has granted Nike a partial win in a legal battle with a social media influencer, finding that he had infringed the sportswear giant’s trademarks through selling counterfeit goods. Social media influencer Eben Fox, who posts under the name Cedaz, had amassed more than a million followers online posting regular content about counterfeits, which Fox also refers to as “reps”, “replicas”, or “fakes”.  The Judge found that it was “undisputed” that Fox sold counterfeit Nike goods in connection with the popular mobile phone payment app CashApp, and that Fox posted counterfeit Nike shoes for sale on the social media platform Discord.

We’re seeing a lot of really weird things springing up around the trade war and what Shabbir is seeing in online discussions is wild, like customs agents talking about a spike in country of origin fraud combined with transhipping. Sven is noticing that there’s a big spike in demand for bonded warehouses, so people managing cross border inventory have a place to stage goods until there’s a break in tariffs. [Story1, Story2]

Sven’s also noticing manufacturers pitching cheaper versions of high end goods at a discount because it doesn’t have the logo on it.

The end of de minimis started on Friday May 2nd. That affects 1.36bn packages that enter the country every year. This change will affect both consumers that buy cheap products from China but also businesses in the U.S. that source their products or parts from China. We’re expecting a rise in the technique of trans-shipping to evade the end of Chinese de minimis packages.

The US Trade Representative released the 2025 “Special 301 Report” on Intellectual Property Protection and Enforcement. There are eight countries on the Priority Watch List: Argentina, Chile, China, India, Indonesia, Mexico, Russia, and Venezuela, and eighteen on the Watch list: Algeria, Barbados, Belarus, Bolivia, Brazil, Bulgaria, Canada, Colombia, Ecuador, Egypt, Guatemala, Pakistan, Paraguay, Peru, Thailand, Trinidad and Tobago, Türkiye, and Vietnam.

Issues with countries cited in the report include poor enforcement of local counterfeit manufacturing, piracy of intellectual property, bad faith trademark enforcement, and poor enforcement of trade secrets, copyright law, and patent infringement.

We’re also tracking this dispute, which is both a federal criminal case and a state attorney general case over where body armor plates, designed to protect law enforcement were made. The vendor in question is accused of using Chinese-made products and claiming they were made in the U.S. The DOJ also stated that these body armor plates failed testing, which is a catastrophic consequence for something like body armor. According to the DOJ, Customs and Border Protection detected these packages during an inspection inside a larger freight shipment in a truck crossing the border from Canada to the U.S.

AI being used to do fraud at scale, including a report from Europol, and a report from Food and Beverage Magazine. Also, AI is being used to generate patent applications, which is probably going to bury a lesser-staffed USPTO.

Shabbir talked about the Amazon Brand Protection Report, which makes him want legislation to ensure all marketplaces work hard to avoid counterfeit products. Shein’s troubles trying (or not trying) to rid their platform of counterfeit Coach bags is worth a listen.

Finally we talk about the same problems in Europe, where it’s estimated that 85% of products from low cost online platforms are counterfeit, and their de minimis problem is three times as big as the United States at 4.6bn packages a year.

Sven would like you to take a moment and appreciate the Plagarius Awards, given to best counterfeit products found online each year.

In this episode, Shabbir and Sven talk about…

Counterfeit forever stamps. Shabbir bought stamps that are too cheap to be true and is sending three letters to Sven, two with fake stamps and one with a real one, to see if they arrive. Remember, the US Postal Inspectors would like you to report fake stamps here: https://www.uspis.gov/report

Counterfeit airbags. We discuss Michigan’s one-of-a-kind auto fraud task force, and their work to fight counterfeit air bags and other fake auto parts. Learn more here: https://www.autobodynews.com/news/michigan-man-charged-with-selling-counterfeit-airbags

More disturbingly is the fact that there may be 81,000 fake air bags floating around in cars: https://www.mlive.com/news/2025/04/michigan-man-allegedly-sold-counterfeit-air-bags-81k-vehicles-may...

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A pharmacy ordered Ozempic from a distributor out of Florida and dispensed it to a patient. It was one of those dial a dose pens and the dial didn’t match their prescription. They brought it back to the pharmacy, who correctly quarantined it and called the Board of Pharmacy.  And this is the best part:

The BOP investigator came over, pulled out his phone and the new magic decoder ring called PULSE that checks the serial numbers, and it was identified as FAKE almost immediately.

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CBP has seized 360,000 fake forever stamps in two separate seizures in Birmingham, AL and Chicago, IL.

CBP Birmingham

CBP Chicago

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In January, the Department of Transportation issued an alert about the massive growth in counterfeit car parts, including fake airbags. They said that in 2024 alone they’d seized over 200,000 fake parts, almost double what they seized in 2023. 

The most disturbing area is fake airbags. 490 were seized entering the country in 2024, and that’s 10x growth in fakes from 2023. And the crime here is in full swing: Homeland Security Investigations say they have 40 open investigations, right now, into fake auto parts.

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Go now and donate to support Sven's Police Unity Tour 400 mile ride.