Amazon and eBay's Counterfeit Marketplace Dangerous for Buyers

Websites profit from consumer deception and dangerous products.

July 25, 2017 - Los Angeles, CA – Amazon and eBay are ideal platforms to enable and facilitate the distribution of counterfeit goods. Some are dangerous and potentially deadly for consumers.

Both websites have morphed into a "Marketplace" model that allows just about anybody, anywhere, to sell just about anything, including counterfeit products. About 50% of Amazon sales are not from Amazon, but from outside global sellers, and 80% of eBay sellers are Marketplace vendors.

Selling counterfeits is illegal and prohibited on both websites. However, despite website policy and repeated trademark infringement notifications, the sellers and items often remain, consumers are deceived and injured, and manufacturers and retailers are being harmed in a big way with little recourse.

• Counterfeit sales can be a lucrative revenue source for the e-commerce giants, as transaction fees are charged for each sale of fake goods.
• Alarmingly, after being notified by rights holders, Amazon and eBay do not tell deceived buyers that they may have received a counterfeit item, even if it’s dangerous or potentially deadly - like OTC drugs, auto suspension parts or exploding Apple® USB chargers.
• There may be no indication in eBay and Amazon seller profiles of a counterfeit sales history, even some sellers having over 100 counterfeit listings removed by The Counterfeit Report, an industry watchdog and consumer advocate. eBay publicly admitted to Business Insider as true, allegations of deleting negative feedback and removing counterfeit comments and warnings.
• A Tennessee family is suing Amazon for $30 million after a counterfeit FITURBO® FI hoverboard caught fire and completely destroyed their $1 million Nashville home in 2016, injuring two of the family’s four children. The plaintiffs contend the hoverboard is counterfeit and claim the product was sold through Amazon Fulfillment according to the lawsuit obtained by The Counterfeit Report.
• After The Counterfeit Report exposed millions of eBay counterfeits, eBay chose not to embrace the efforts, but to ban The Counterfeit Report's test purchase accounts, and by extension, protections afforded eBay consumers.
• Amazon often claimed infringing listings were removed when they were not, allowed reported counterfeits to remain on other Amazon global websites, and was caught altering infringing content to allow the counterfeit to remain.
• The U.S. Postal Service also loses millions delivering counterfeits from China under reduced “terminal fee” postage agreements.

Counterfeiting is a $1.7 trillion global criminal enterprise forecast to grow to $2.8 trillion by 2022. Counterfeiting is profitable, difficult to track and widely unpunished. These benefits are drawing an avalanche of counterfeit listings from both U.S. and global sellers. Could you identify the fake items below?

The items shown are all inarguably fake - they bear a registered trademark, but do not exist in any manufacturer's authentic product line. The items were listed or purchased on Amazon and eBay.

(Photo: The Counterfeit Report® - left to right)

1. It's a simple scam, take a low capacity memory card costing a few cents and reprint it with a higher capacity label and a globally recognized trademark. These tiny microSD® computer memory cards are used in cell phones, cameras and laptops.  Authentic microSD® cards bear the microSD trademark, owned by SD-3C, LLC and licensed to authentic, conforming products. Memory on counterfeits is usually not the capacity of what is published on the card, and the fake items may fail. When that happens, you are likely to lose your data, images, and damage your equipment. The Counterfeit Report has removed 1.8 million counterfeit microSD items from eBay and Amazon, yet the easily identifiable fakes continue to be listed.
2. Dr. Numb® over-the-counter ("OTC") 5% Lidocaine topical pharmaceutical is not manufactured in a 10gr. size, or with an obvious spelling error. Unsuspecting consumers receive a non-FDA registered fake product which may contain tetracaine, a local anesthetic. Misuse or an overdose of tetracaine can cause birth defects and fatal side effects. The Counterfeit Report has removed 4,721 counterfeit Dr. Numb products from eBay, 2,097 have been sold to consumers. The items remain on eBay despite warnings to eBay executive staff and general counsel.
3. Novartis Lamisil® (terbinafine) is a FDA registered over-the-counter ("OTC") anti- fungal antibiotic. Lamisil is used to treat infections caused by fungus. This liquid is not a product offered in the Novartis Lamisil product line. Its ingredients are unknown. The maker of the counterfeit sold on Amazon and eBay was criminally charged after an investigation by The Counterfeit Report and manufacturer.
4. The CIA does not issues badges to its employees - the item is fake. Federal law prohibits use of the words "Central Intelligence Agency," the initials "CIA," and the seal of the Central Intelligence Agency. Federal, state and local laws regulate the sale, purchase, possession and display of badges, as of course does common sense. eBay and Amazon policy also specifically prohibits most police badges and items. This fake CIA badge, as well as counterfeit FBI, Secret Service, LAPD and other law enforcement badges and ID are common on eBay and Amazon. The items are available to terrorists, child predators and other criminals. 3,700 counterfeit badges have been reported to eBay and Amazon, over 50 easily purchased by The Counterfeit Report. The items remain.
5. Drew Tech's MongoosePro interface cable is relied on by vehicle technicians and dealers to program vehicle computers including braking, emission and safety equipment functionality. Counterfeit Mongoose® products may severely damage a vehicle, and install malware on the user's computer. The authentic product is not made in purple - an obvious fake. 358 counterfeit items have been sold.
6. The authentic Skunk2® performance shift knob is only available in a matte grey titanium finish, however The Counterfeit Report reported 1,663 easily identifiable colored fakes listed on eBay in red, neo-chrome, blue, green, gold and chrome. The Counterfeit Report found 3,304 counterfeits, with 1,780 sold. The fakes continue to be listed.
7. Vans® does not make iPhone® 6 & 7 cases – an obvious fake, but they are common on eBay and Amazon. Counterfeit product sales support terrorists, organized crime and other criminals.
8. Group-A Autosports Rear Lower Suspension Control Arms are direct replacements for a vehicles original suspension parts. You are risking your life, and the lives of others, using untested and unproven counterfeit auto suspension parts. Counterfeit parts may catastrophically fail at a critical time causing injury or death. The authentic product is not made in green - an obvious fake. The Counterfeit Report found 783 counterfeits on eBay, 150 sold to consumers who may be unknowingly driving on a dangerous suspension part.

The Counterfeit Report, has identified over 3 million counterfeit items on eBay and reported over 1.9 million for listing removal, authorized by the right's holder. eBay reported that over 600,000 counterfeit items had already sold to eBay consumers. While the items would be covered by eBay's "Money Back Guarantee," eBay doesn’t notify the buyers.

Amazon received formal infringement notices from The Counterfeit Report, authorized by the right's holder, for 29,554 counterfeit products offered on Amazon in just the past year. Many took repeated demands for removal, and while some were removed, the counterfeits still remained on other Amazon global websites. Amazon doesn’t notify buyers they received a fake.

In addition to trademark, copyright and patent infringement, all sorts of despicable things are involved in counterfeiting; terrorism, child labor exploitation, kidnapping, money laundering and organized crime. Bruce Foucart, director of U.S. Homeland Security’s National Intellectual Property Rights Coordination Center stated the killers in the vicious Paris Charlie Hebdo massacre that left 12 people including two police officers dead, funded their weapons cache through the sale of counterfeit luxury goods.

If Amazon and eBay want to maintain any consumer trust, they need to cleanse dishonest and fraudulent sellers and close counterfeit loopholes. Web platforms that facilitate criminal activity and benefit from the proceeds of dishonest actions which impact jobs, consumer safety and public trust create a public perception of deception and impunity.

However, their reputation damage is inconsequential to the real problem: counterfeiting is stealing from consumers, costing U.S. manufacturers over $250 billion, and U.S. workers over 750,000 jobs.