The Top Three Dangers of Illicit Cigarette Trade

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The illicit cigarette trade is defined as “the product, import, export, purchase, sale or possession of tobacco goods which fail to comply with legislation.”

This includes categories such as contraband (smuggled tobacco products without domestic duty paid), counterfeit (manufactured cigarettes without authorization from the rightful owners, with intent to deceive consumers) and illicit whites (brands manufactured legitimately in one country but smuggled and sold in another without duties being paid).

Below are the top three reasons why the illicit cigarette trade is dangerous to consumers:

The Price:
With its lower-than-market price and easy purchase channels, illicit cigarette trade creates affordability for youth. For example; in Canada, illegal cigarettes accounted for almost 20% of all cigarettes smoked by adolescents. In addition, the low price make illicit cigarettes more available. The availability not only encourages youth to begin and continue smoking long-term but also makes it less likely that they will quit.

The Supporters:
Cigarette smuggling often leads to the funding of much larger criminal operations, such as drug smuggling or human trafficking. These criminal organizations are attracted to the low production cost, high demand and huge profit margins that illegal cigarettes create. In one example, police estimate that the IRA (Irish Republican Army) was able to make $100 million in the past five years in illicit cigarette trafficking alone.

The Quality:
Illegal cigarettes are not subject to any regulation, nor do they comply with industry standards. Because of this, they pose increased health risks to smokers. The ICC (International Chamber of Commerce) warns that counterfeit cigarettes were found to contain five times more cadmium, six times more lead, 160% more tar and 133% more carbon dioxide. In addition, these knock-off cigarettes are typically kept in unsanitary conditions; some were found to contain dead flies, mold and even human feces.

Governments and brand owners alike warn consumers of the common indicators of illicit cigarettes such as cheap price, unusual taste and the absence of warnings. However, leaving this responsibility up to the consumer can likely put the consumer’s health and life at risk.

DSS and AuthentiGuard are working around the clock to stop dangerous situations such as this. To learn how AuthentiGuard can protect consumers and brands alike, please visit www.AuthentiGuard.com

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Top 5 Things You Should Know About Pangea VII and Online Pharmacies

SpilledPillBottle 1.) What is Operation Pangea VII:
Operation Pangea VII is a collaboration of law enforcement, customs and regulatory authority forces of 111 countries to identify the makers and distributors of illegal drug products and medical devices that used the internet to sell their products and then remove these counterfeiters from the supply chain. (Source)

2.) What Did Operation Pangea VII Accomplished:
In just one week of investigations in May 2014, Operation Pangea VII’s efforts at mail facilities around the world resulted in the detention of 19,618 packages containing unapproved or suspected counterfeit prescription drugs. (Source)

3.) The Numbers Behind Illegal Online Pharmacies:
The proof is in the research. A survey conducted by NABP in September 2013 found that 96.7% of online pharmacies selling to U.S. citizens were “rogue.” This means that they did not comply with U.S. laws and regulations and therefore, their medicinal quality could not be guaranteed. In other words, out of over 10,000 online pharmacies included in this survey, only 90 could be verified as legitimate. (Source)

4.) Not Even the Trusted Online Canadian Pharmacies Can be Authenticated:
A second study by the National Bureau of Economic Research in 2012 researched samples of five common brand name prescription drugs in their most popular dose from a variety of online pharmacies. The study found that 9% of certified Canadian pharmacies delivered drug samples that were not what they ordered. The same study also verified that many uncertified pharmacies claiming to be Canadian actually shipped from other countries. (Source)

5.) The Dangers Illegal Online Pharmacies Pose to Consumers:
Douglas Stearn, Director of the FDA’s Office of Enforcement and Import Operations, says it best: “When consumers buy prescription drugs from outside the legitimate supply chain, they cannot know if the medicines they receive are counterfeit or even if they contain the right active ingredient in the proper dosages. Consumers have little or no legal recourse if they experience a reaction to the unregulated medication or if they receive no therapeutic benefit at all. In addition to health risks, these pharmacies pose other risks to consumers, including credit card fraud, identity theft or computer viruses.” (Source)

AuthentiSite is working tirelessly to stop dangerous situations like online pharmacies from harming consumers. To learn more on how AuthentiSite can help protect your brand and consumers alike, please visit www.AuthentiGuard.com

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Identifying Counterfeit Beauty Products

As the problem of counterfeit beauty products rises, the AuthentiGuard team has compiled a few quick, easy tips to help you shop safely.

  1. For liquid beauty products such as lotion or hair products, make sure you smell the product before you purchase it. If the smell varies even slightly from the usual clean scent, you may have a counterfeit product at hand.
  2. Check the bottle. Is it damaged, dirty or faded? If yes, this product could have been diverted from the supply chain. The danger that lies here is that this product is most likely expired or tampered with – putting you at risk.
  3. Look closely at the label. If the brand name is misspelled or a logo or image is blurry, there is a good chance that the product you are holding is not authentic.
  4. Be wary of where you purchase your product. Oftentimes stores such as Walmart or Target can get higher end brands that are counterfeit or diverted. Be aware of authorized resellers for your favorite beauty brand. If you are going to purchase a high-end product, purchase it at a salon or beauty store such as Sephora or Ulta.
  5. Don’t buy it online. As the old saying goes, if it is too good to be true, it probably is.

It’s very important to realize how dangerous a counterfeit beauty product is. The groups driving these counterfeit products have no government regulations to abide by. Diverted products can be expired, or improperly stored, leaving you open to a world of harmful bacteria. Additionally, counterfeit products may have been created in an unsanitary environment and may contain dangerous contaminants. For example, there has been reports of toxic chemicals, and even urine, in some counterfeit perfumes.

To learn how AuthentiGuard can help keep your brand and consumers safe, please visit www.AuthentiGuard.com 

One Consumer’s Story of Online Counterfeiting

Our webinar last week discussed in depth the findings of our market research study conducted by Harris Poll. Since then, a consumer has stepped up and asked us to share his experience with online counterfeiting with the brand protection community. Below is the interview:

Thanks for speaking with us today. Tell us a little about your experience with counterfeit products.
No problem. I bought tickets to a popular concert through an online ticket reseller website and they were mailed to me shortly after I purchased them. Unfortunately, when I got to the gate come show time, my tickets wouldn’t scan. This is when I learned that my tickets were fake and I wouldn’t be permitted inside the venue.

Did the tickets look counterfeit?
Not at all. They were seemingly identical to the ones the rest of my group had. The only difference was that they wouldn’t scan at the gate.

Who do you feel is responsible for this?
A part of me wants to blame the venue while the other part of me thinks its the website’s fault. Either way, both facilities allowed counterfeit tickets for this show to get into the hands of unknowing consumers.

Were you offered a refund?
No unfortunately not. I was out the money for the tickets.

Have you had any other problems with counterfeit goods since?
Yes, a few months later I tried to purchase a popular pair of shoes online. What happened instead was the money was taken out of my account and the shoes never arrived. When I tried to get into contact with the company, my calls and emails were ignored. I never received a refund.

What would you tell someone in your position? 
I would tell them to always think twice when purchasing something online – especially something that is in high demand. If the items are marked down significantly from retail prices, I wouldn’t go through with it. This can truly happen to anyone.

To learn how brands can protect their products and consumers alike, please visit http://www.AuthentiGuard.com

Counterfeit Tickets – A Growing Problem?

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by Pat McInally, DSS Director of Sports and Entertainment
949-466-2460

Imagine scoring coveted tickets to a concert. You spend weeks, months even, excitedly preparing for the day but, when you get to the venue – security won’t let you in. 

Unfortunately, this is what happens to hundreds, even thousands, of attendees each year. Today’s phony tickets look and feel authentic to the buyer – but they will not get the holder into the concert, fairground or sporting event. 

In just the last month news broke about…

  1. NHL warns unsuspecting fans that they may be targeted by bootleggers selling unauthorized or knock-off tickets (Source)
  2. Police Warn of Tickets for Fake Fairgrounds Event (Source)
  3. Annual Dollar Amount of Ticket Fraud? $4 Billion. (Source)
  4. Authorities Investigate Bogus Blackhawks Tickets (Source)
  5. Suspected Counterfeit Tickets at Coppin Graduation – Hundreds Shut Out (Source)

Given the seriousness of this growing problem, what can these major venues do to protect their consumers?

Stay tuned to find out…

 

For more information on how AuthentiSuite can protect brands and consumers alike, please visit www.AuthentiGuard.com

The Problem With Website Seal Programs

According to truste.com, 90% of adults are concerned about piracy, and 88% avoid companies that don’t protect their privacy. Because of this, companies participate in website seal programs to prove their validity and, in turn, gain their consumer’s trust and business.

In order to earn these seals, companies typically have to go through several privacy and website infrastructure checks. This process is set up to ensure there are minimal threats to a customer’s personal information. Once the website passes, the website is approved to display the seal’s artwork.

The security problem isn’t in the seal process – its the seal’s artwork. According to our online survey, conducted on our behalf by Harris Poll in January, among 1,000 smartphone users (18+), almost half of smartphone owners (48%) believe that marks such as SSL certificates and a verified symbol are signs that an online retailer is genuine.

However, without an authentication feature built directly into the artwork, anyone with a mouse can drag and drop the trusted images onto their own website – without a doubt, counterfeiters know and actively practice this. 

71% of smartphone users stated that merchant websites are at least somewhat capable of preventing online purchases of counterfeit merchandise. But is displaying an easily duplicated image all they can do? We don’t think so. 

Here at DSS, we have taken a strong stance against phishing and counterfeit websites, which is exactly why we created AuthentiSite. By building a seal with a non-transferable authentication feature, and backing it with cloud-based security look-ups, DSS’s AuthentiSite solution bridges the gap between seal programs and actual website authentication.

For more information on how brand owners and consumers alike can curb the issue of counterfeit websites and product, please visit www.AuthentiGuard.com

Research methodology:
This survey was conducted online within the United States by Harris Poll on behalf of Document Security Systems, Inc. from January 2-8th, 2014 among 1,015 U.S. smartphone owners ages 18 and older. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables, please call the DSS Corporate Office at 585-325-3610.

Brand Protection Game: The Results

We had a great response to last week’s brand protection game! Our goal for this was to simply see how companies are currently handling the issue of counterfeiting.

Without further ado, the results:

1.) Has your company seen a rise in counterfeit products or websites? 

  • 100% of respondents said yes

2.) Does your company have a dedicated brand protection department?

  • 50% of respondents said yes
  • 50% of respondents said no

3.) Currently, how much of your company’s budget is allocated towards brand protection?

  • 50% of respondents said 0%
  • 20% of respondents said 25%
  • 17% of respondents said 50%
  • 0 respondents said 75% or more
  • In addition to this several respondents said “5%” or “unknown”

4.) Does your company engage in searching or tracking the web for counterfeit websites?

  • 33% of respondents said yes
  • 66% of respondents said no

5.) Has your company done anything to engage it’s consumers in the fight against counterfeit products and websites?

  • 33% of respondents said yes
  • 66% of respondents said no

The main takeaway we found from this game was that despite the fact every participant has seen a rise in counterfeit products and websites, companies are still dragging their feet when it comes to protecting their consumers. 

What do you think companies could do to help curb this growing problem? Tell us in the comments!

For more information on how AuthentiGuard can help brand owners and consumers alike, please visit www.AuthentiGuard.com