Consumer Law

Fake and Counterfeit Goods Are No Bargain

Learn why buying and selling counterfeit goods isn't the bargain it might seem to be.

You’re likely familiar with the well-known maxim, “If it seems too good to be true, it probably is.” When purchasing expensive, brand-name items, it’s wisdom worth heeding. High-quality items come with a steep price tag for a reason, so if you’re offered a coveted item at an unbelievably low price, you’d be well served to be suspicious. This especially holds true if you’re buying the product somewhere that selling counterfeit goods is big business, such as a souvenir shop, flea market, or online store. Otherwise, you might end up a victim of consumer fraud.

What Are Counterfeit Goods?

Counterfeit products—sometimes called “knockoffs”—are purposely manufactured and sold as an imitation of a brand-name product. These fakes usually fall into one of the following categories:

  • clothing and accessories, such as watches, jewelry, shoes, handbags and wallets
  • electronics, including computers and accessories
  • movies, music, games and other media, and
  • medications and personal care products.

The producers of such products often make counterfeit labels and tags to help pull off the deception. The manufacturer often ships the two separately, and they’re combined later to make the counterfeit goods harder to track and seize.

Is It Illegal to Buy and Sell Counterfeit Products?

According to the United States Department of Justice, it’s not illegal to buy a counterfeit product for your personal use—even if you know it’s a fake. However, it’s considered fraud to manufacture, ship or sell forged, fake, or counterfeit items under federal law. For instance, laws forbidding trafficking in counterfeit goods or services do not allow the use of another’s trademark.

An individual caught violating the law risks losing the property and all equipment necessary for its manufacture and distribution. Additionally, legal penalties can include up to 15 years of incarceration, a fine of up to $30,000, or both. These penalties can apply even if the seller discloses the counterfeit nature of the products.

Counterfeit Products Harm Buyers and Sellers

Buying and selling counterfeit goods isn’t without harm. It can cause many problems in the marketplace. Sellers might hope to fool consumers into overpaying for a fake purse, watch, or artwork. Legitimate manufacturers can see their profits decline as fake products eat into their bottom line, or suffer bad publicity when a product bearing their label doesn’t work properly.

Before you buy a counterfeit product, you might want to consider that the source of the counterfeit item is likely a sweatshop that doesn’t follow environmental, business, or child labor laws. Also, if you buy it online, you could become a victim of identity theft given that you’re turning over personal financial information to an organization willing to operate an illegal business.

Most importantly, counterfeit goods can be unsafe. For instance, the United States Drug Enforcement Administration reports that the drug market has been flooded with counterfeit prescription medications laced with hazardous substances. These drugs, which look identical to legitimate prescription pain relievers or sedatives, can claim the lives of unsuspecting consumers.

How to Spot a Genuine Product

Your best protection is to know the product. You can improve your ability to spot fakes by learning the traits that make a product authentic.

For instance, ask yourself whether the product seems unusually cheap. Crooked stitching, low-quality materials, smaller than average dimensions, or blurry patterns can be giveaways. Additionally, many manufacturers provide guides that will help you ascertain the legitimacy of the product.

It’s also a good idea to read online seller reviews. Be especially wary of negative reports or accusations of selling knockoffs.

(Learn more information about your rights as a consumer by reading Consumer Protection Laws.)

Questions for Your Attorney

  • Can I face criminal prosecution if I unknowingly purchase knockoff goods and resell them as authentic at a flea market?
  • Do I have recourse if an online seller sells me a fake item?
  • How can I report a seller of counterfeit goods?

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