A December 2012 conviction and tough sentence sent a strong message to the market in a recent high-profile case. And although this is the first time people in Sweden have been identified, charged and found guilty, it once again focused the need for ongoing vigilance in the battle against counterfeiting. The case resulted in a one-year jail sentence for the guilty individual, as well as a five-year ban on trading, and a payment of SEK 600 000 to SKF.

Huge profit margins motivated counterfeit selling

“The convicted man was the main person behind the company and the counterfeiting activity,” said an SKF spokesperson. “The motivation behind their business dealings was clearly the huge profit margin. Their import price was extremely low yet their market price was normal.” The story dates back to January 2010, when a customer in Sweden’s Dalarna region made a complaint to SKF about the performance of a bearing they had bought from a small local company. An investigation commenced with an onsite inspection of the company’s products at the customer’s offices. Test purchases from the company were subsequently established to be counterfeits. With the wheels in motion, the authorities were alerted and, after a period of liaison, a decision was taken by the police in March, to simultaneously raid the company’s two premises, in the capital Stockholm and in the small town of Avesta. SKF was present to support the police with identification of the counterfeit products. Following the seizure of stock, several persons connected to the company were all detained separately for questioning by the police.

Authorities praised for positive co-operation

The plot further thickened the following month. Swedish police received notice from customs officials that a shipment from China had passed through, bound for the company under suspicion. This action was crucial to the eventual prosecution, with the focus now very much on the nature of the recently ordered goods to confirm complicity in the counterfeit activity. With this new information a further raid took place on the company’s store in Stockholmin April 2010. In total almost 7000 items with a weight of 3 tonnes were established to be counterfeits and seized by the police.

Despite having been raided in March and under suspicion, the company unpacked and displayed the newly arrived suspect products for sale. This action was a vital factor in the court verdict and sentencing procedure, as it showed the prosecution that the defendant had clear intent to sell the counterfeit SKF products. Police had seized computer equipment from the company’s premises, on which mail correspondence with various companies was found. This correspondence was used as evidence that they knew that the bearings were in fact counterfeit when ordering them.

SKF Group Brand Protection was very happy with the co-operation they received from the authorities. “In cases like these we need to convince the authorities that it is worth going ahead with a prosecution. This case received very high attention and was well coordinated at every stage, and will make it easier for similar actions to be initiated in the future, if necessary.”