- 19 hours ago
Police crackdowns force the fakers to adapt--moving from the streets to operate out of hotel rooms, using an army of pointers and runners to guide customers to the products. For the US Customs and Border Protection and Homeland Security it's a cat and mouse game...
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00:13Counterfeiting is a giant globe thing, and everything can be faked.
00:16We have Gucci in there, and we have some big name in there.
00:21The enterprise is breathtaking.
00:23They're selling these watches on eBay, and that's the real thing.
00:27There's no single market.
00:28Literally, these boxes are the corners of the planet.
00:31No single point of entry.
00:33Every crackdown drives fakers to ever greater levels of cunning.
00:38Counterfeiting has been here forever.
00:49Since 9-11, customs stopped a lot of s**t, and right now, especially bootleg s**t, they're trying to stop it,
00:55because they're still complaining.
00:57But f**k, those stores, I got to get money.
01:04You get money.
01:06You need some money to get my f**kers over here.
01:08Tommy Vuitton considers himself a knockoff entrepreneur.
01:31Tommy is elated. He has just received a shipment of fakes that have been sneaked through customs.
01:36A-plus right there. A-plus.
01:39I do wholesale, retail, pre-tail. Don't give a f**k about it. Just get it in all day long.
01:50Tommy is a wholesaler.
01:52Sometimes it'll be $400,000 of shipment worth of clothes, worth of merchandise. Every shipment, like a half a million.
02:02The key to being a successful fake wholesaler is understanding your market.
02:07Rich people buy it. Poor people buy it. Middle-class people buy it. Overseas people buy it.
02:13Everybody's into the counterfeiting s**t nowadays. And there's nothing wrong with it. Get your money.
02:19Get your money the best way you know how to get your money.
02:22If that's selling counterfeiting s**t, get your money selling counterfeiting s**t.
02:27People don't have $15,000, $1,500 to buy a pocketbook. So you'd rather give me $250 for a pocketbook,
02:33I'll take it.
02:35Based in Harlem in New York, Tommy ships wholesale to towns and cities east of the Mississippi.
02:41I supply about 57 to 60 stores in New York City. North Carolina, South Carolina, Florida, Miami, Detroit.
02:57Primarily most of our targets here come right out of New York.
03:01There's no hesitation to ship the counterfeit goods. A lot of these guys are buying right from New York, right
03:07through UPS.
03:13A small town somewhere in Ohio.
03:19It's Friday and it's market day, but this one is different.
03:23Once we all arrive at this location, everybody has to be in plain clothes.
03:30A team of 50 Homeland Security and Immigration and Customs Enforcement agents is targeting a number of counterfeit traders.
03:38At any time I want to see no visible markings. I don't want your radios down. I want no notification.
03:44Once you're in place to hit your target, you will then, you can remove your outer shirt. I prefer you
03:49do that as the team leaders.
03:51You will identify yourself and then we're in business. We're going to take everything we can.
03:56If they're still there and it's counterfeit, we're not leaving without it today. I want you to seize money today.
04:01Agent Santana and his team have been developing this case for over 18 months.
04:07Today is the counterfeiter's day of reckoning.
04:11It's anticipated at the end of this that we will indict approximately six to ten people
04:16and we will be charging them criminally in trafficking and counterfeit goods.
04:22Plain clothes agents move discreetly through the market to eyeball the targets.
04:31Once identified, Santana gives the order to move in, make the arrests and seize the goods and cash.
04:38Go, go, go.
04:40Excuse me, excuse me.
04:42They apprehend the first target.
04:45What do we got?
04:46Uh, this gentleman is being uncooperative.
04:52The suspect is concealing his goods in melon crates.
04:55If I have a product in my van, why do you guys want it?
04:58Talk to right here. This is AJ right here.
05:00We'll handle everything you need.
05:01Dude, here's your rights.
05:02No, stop.
05:03Stop.
05:04You don't have any weapons anymore, right?
05:05Another target is making excuses.
05:07He claims he's just a visitor.
05:10Go ahead, Roman.
05:11432.
05:12Copy.
05:13OK.
05:15Word spreads fast.
05:16It's a major bust.
05:18If you have any identification, that'd be great.
05:20A target is stopped as he reloads his van.
05:24I didn't see him even see me.
05:25I mean, he just kind of slinked out.
05:27But some of the targets have slipped away.
05:29Did they leave that money?
05:30We got a little bit of scratch, but they took the cash box.
05:32They took the cash box?
05:33He eyeballed me, bro.
05:34I mean, that's what it is.
05:35That's fine.
05:36That's OK.
05:37CBP ID box is at $199.
05:39Agents hold a target who has so much stuff,
05:41he couldn't pack it away in time.
05:44And then the bigger, larger ones are there.
05:46That's it.
05:46And then the sickness.
05:48OK.
05:49Sounds good.
05:50A suspect wholesaler is apprehended.
05:55I understand what you're buying.
05:57I understand your situation, sir, like as far as where you buy.
05:59He's nervous and becomes animated.
06:01What company here, I can get it.
06:03It's people to sell it here.
06:04Hey, get over there.
06:05I don't like his posturing.
06:07What's the company I can get to sell that?
06:09The agents discover the suspect is living in the United States illegally.
06:14The subject is a final order of removal.
06:18So, meaning, uh, he's, uh, we're gonna take him and process him.
06:22Over here to the van.
06:23Put your hands up on the van for me, please.
06:25Yes, sir.
06:26Do you have any weapons or anything on you, sir, that I need to know about?
06:28No, no, I don't get it, Your Honor.
06:29OK.
06:31This is money that was on the table as well under a box.
06:34It's been a good day for the Ohio cops.
06:37But with crackdowns like these on open street sales,
06:40some big city purveyors of fakes tend to operate differently.
06:50New York City, Midtown Manhattan.
06:55All right, brother.
06:56Here, the sales force keeps out of sight.
06:59Instead, the counterfeit turf belongs to lookouts and runners.
07:05They lead customers, salesmen, and a digital shop front.
07:10We have Gucci in there.
07:12Also, we sell the sneakers like the Jordan, the bronze shop.
07:16We have Microcross in there.
07:17We have some big names in there.
07:25Abu sells the brand some people feel they can't live without.
07:29I born in Chicago, huh?
07:31We here, we hustle it, we make our own.
07:34One dollar, two dollar.
07:35We don't hurt nobody.
07:41Abu and the lookouts live hand to mouth.
07:43Their visa status unknown.
07:45Jamaica, man, but Africa, you know?
07:48Just trying to make a little bit.
07:50If you don't have a paper, you can't survive.
07:53Because you can't walk if you don't have a paper.
07:56You can't walk.
08:02It's precarious work.
08:04Abu is never sure if he's selling to an undercover.
08:08You can get arrest.
08:09The risk is big.
08:10You can get arrest.
08:10You can go to jail for it.
08:12Some people go to jail for like three years.
08:15Some people go eight years.
08:16But they can take you back home for it.
08:19So you can get deported to your country back.
08:23The tablet storefront keeps costs low.
08:25No sky high rent.
08:27No utility bills.
08:29They have many stuff.
08:31So we sew you if you like it.
08:34And they will bring it for you outside.
08:36And they will make sure we in the safety place.
08:38So we can open and sew you.
08:40So you like it.
08:41You buy it from there.
08:42And that's it.
08:43That's how we do every single day.
08:46We're getting them from white people.
08:50All these boxes with red labels.
08:52This is all stuff that's been seized.
08:54It's all found to be in violation of various laws of the United States.
09:0224 million containers turn up at American seaports and border crossings each year.
09:09A quarter of a billion express packages arrive by air.
09:13The New York, New Jersey ports are a major gateway.
09:17For wholesalers and retailers in the New York region.
09:20This is where the fakes come in.
09:23CBP and Homeland Security are the gatekeepers.
09:38It's got a tag on it itself, even with a skew so it looks as real as it can get
09:42an MSRP sticker on it.
09:44We got a whole box right now.
09:46The quality and the craftsmanship is fairly decent.
09:51But most likely somebody from Michael Kors will be quick to point out what's counterfeit on this bag.
09:56In this shipment, we have high-end counterfeit watches.
09:58Very hard to discern what's real and not real.
10:01And they will sell these watches either as counterfeit and tell the people, look, it's a knockoff watch.
10:06But there's more an insidious side to this trade where they're selling these watches on eBay.
10:10And that's the real thing.
10:11You normally see this retailing for at least $10,000 and above for a single watch.
10:17Okay, so in this box, if all these watches were real,
10:20you're probably looking at about a million dollars worth of product.
10:29The counterfeiters know the way the laws are written, because we've prosecuted enough of these cases,
10:34if you get caught with an entire shipping container of thousands of items, you're looking at the maximum
10:39sentencing under any of the counterfeit goods trafficking laws. If you get caught with a couple
10:46of boxes of jerseys, you're always going to be small time. It doesn't matter that you may do thousands
10:53and thousands of boxes at a time, you're never going to be hit with that large penalty.
11:12A short walk from Fifth Avenue, the sweet man hides from the law in his midtown showroom,
11:18a low rent hotel for hookers, pimps, and knockoff store men.
11:22I have to look over my shoulder. I'm leaving my house now knowing if I'm going to go back to
11:27my
11:27children. That's why it makes me hate the job. But he's in too deep to back out now.
11:33I'm a middle man. I got people above me. I got people below me.
11:37Let's back up some person with like $6,000. I set up about 10% of that, like $500.
11:44The game is really serious now for me. I would have said my good weight, I'm looking at about like
11:50$1,500 to $5,000 a week.
11:56Sweet man sells to anyone, but he does have his personal favorites.
12:10After years of selling on the street, Sweet Man has become a self-taught handbag expert.
12:16Giving insider tips helps make the sale.
12:19Some stuff's so good that you will believe that people from the show is giving you these
12:24stuff. The handle is supposed to come in red leather. My sample on this, I put water on it,
12:30as you can see. It will change colors right away. The only thing that makes it fix is the serial
12:36number which is located right here. It always has the same serial numbers in all the bags. All the
12:42bags come with the same thing. Sometimes he wonders if his skills are wasted.
12:50With all the knowledge I have, if I get a opportunity to work at Chanel stock, yeah,
12:55I would take that job. Take that job telling myself legal.
13:00Consumers buy fakes because they want to bargain. The lure is the label.
13:07The brand doesn't have to be high-end, but it has to be cheap.
13:11We've got a guy who makes fake Tide. He prints up his labels, he sticks them on the orange buckets,
13:16and he sells them as five-gallon buckets of Tide. They're called bucket sellers,
13:20and they've sprung up all over the country.
13:29We are one of three units in the United States that I know of who fight counterfeit goods.
13:35Okay, let me know what you find out.
13:43Dave Lake runs the organized commercial crimes unit of the Phoenix Police Department
13:47with a team of nine undercover agents. The unit works over 2,500 cases each year.
13:53The shadow economy is about commerce. It's about illegal commerce. And the biggest threat in the
14:00shadow economy, of course, is IPR, which is intellectual property rights or counterfeit goods.
14:04It is a parasite on legitimate commerce, and it drains away money that we rely on as a society.
14:10Today, Lake and his team are taking down the counterfeit Tide Brewer,
14:14who's working out of a self-storage facility.
14:16He's mixing all kinds of different chemicals. We assume they're safe,
14:19but they're not being used in the way they were intended, so we don't know.
14:23There's no material data sheet on them. I myself am highly allergic to whatever's in these chemicals.
14:28And the other thing is, is that he's not selling these to upper middle class people.
14:33The average consumer of this is a poor person who's trying to get a deal.
14:38To catch the Tide suspect, officers engineer a bi-bust sting.
14:45Lake has set up a hidden camera overlooking the storage unit.
14:49He monitors the target on his smartphone.
14:53Our undercover guys are going to go in and are going to buy a pallet of him.
14:56We ask for a pallet to force him to make a bunch. And then we're going to drive away,
15:00and we're going to arrest him for the manufacturing of counterfeit goods.
15:06Tide is a big commodity. It's expensive at the store, and it's a consumable, meaning that I'm
15:12going to buy it again. And it's portable. It makes a great shadow economy currency, if you will.
15:18As the suspect prepares the fake Tide order, Lake briefs the arrest team.
15:23Here, when you come in this way, we'll run down this and stage right there,
15:26so that if he flees or anything, we're there to take him with you.
15:33As arranged, the undercover pulls up in a rental van to pay the suspect and collect the Tide.
15:40Just a block away, Dave Lake's team, supported by uniformed officers, gets ready to move in.
15:48But it's not clear if the suspect is armed.
16:05In the black market, the fake Tide scam is, in fact, a better business than selling crack
16:10or meth off a corner. It's a lot safer. Rivals are less likely to kill you for your turf.
16:17And you might think you're invisible to the cops, but not in Phoenix.
16:22You have to stay here, because guns are going to be pointed this way.
16:25So when we get up there, we have to stay back.
16:36As soon as he starts at the engine, he'll shoot down this wall and crouch.
16:42As the undercover shakes on the deal, the trap is sprung.
16:57Your hand, man. I want to see your hand. Right there. Right there.
17:01From there. Fake detergent is an easy scam in the shadow economy. There's a never-ending demand.
17:09He's going to spend $6 for a bucket, and he's going to spend a little bit of money for his
17:13soap.
17:14The water's free.
17:14How many weapons are on you, man?
17:15A knife right there on the seat right there.
17:18Okay.
17:18He's probably costing him $10 to $12 for a bucket, and he's going to sell it to us for $45.
17:23So his profit's going to be extremely high. Now, you compare that to drugs, and every person
17:28whose hand is in the process of making and manufacturing and moving the drugs into the United States,
17:33they all take a percentage. They're not getting 500% markup. But this guy's going to make almost
17:38300% markup on this.
17:41You're under arrest for trafficking and manufacturing and selling counterfeit goods.
17:45You're faking that tide. That's not real tide. And we've been buying from you for a while with a lot
17:49of different folks. But you know that's against the law, so we're not going to play any games to take
17:52you down there, read your rights, talk to you about it, see what's going on. Okay?
17:56This stuff burns my hands, by the way. I don't know what's in that, but I'm allergic to it. You
18:00should feel bad.
18:01But Lake encounters a problem.
18:05Ideally, everything operationally went perfect, but you can never count on the suspects, right?
18:09Ideally, he would have had the stickers put on the buckets. We've bought other loads from him that had
18:15the stickers on the buckets. So our case is fine, but the big load that we just picked up,
18:20his production operation wasn't strong enough. Basically, he didn't get the chance to prank the
18:26labels. And a counterfeit item without a label is not a counterfeit item. It's just a cheap one.
18:32In the counterfeit world, it's the label that makes the sale, but it's also what gets you busted.
18:42Looks like we got a package here of Tory Birch metal labels. Now, this is the new paradigm we see.
18:49We do see coming through sea freight are containers of just blank product.
18:56Counterfeiters use the law to beat the lawmakers in an elaborate game of cat and mouse.
19:01It'll be blank handbags or generic, as we call them, handbags, purses and wallets. They don't
19:07have any labels on them. Then what we'd find is we get boxes of nothing but labels. They have these
19:15warehouses here in New York where they'll relabel all their products so that it goes from a bunch
19:21of perfectly legal generic handbags that are completely blank. But the minute they started
19:27fixing these labels to them, that's when they make the final counterfeit product. They'll run these
19:32warehouse operations where vehicles from all over the country come. Maryland, Georgia, North Carolina,
19:39Texas. They'll pull up, they'll load the vehicle full of blank bags. And then at the last minute,
19:46the person will get either a box like this so that he can go wherever he is, whatever flea market,
19:52and make his finished product. For the inspectors, it's like looking for a needle in a haystack.
20:04JFK package handlers process up to 600,000 incoming shipments a day.
20:12The sheer volume gives the counterfeiters an edge and greater earning potential.
20:17The profit they make is amazing. We get their bank accounts when we do these investigations,
20:22and they're making millions of dollars. They do everything they can to try and launder it,
20:27and then send the money overseas. Everything they can that we usually see with the drug industry,
20:32we see the same problems coming in for the smugglers of these items.
20:37They just can't get rid of the money fast enough.
20:43But CBP has some tricks up its sleeve.
20:49They're like any other smuggling group. They try to be unpredictable, and we try to be more
20:55predictable as them in our examination techniques. What I have here is a physical exam being conducted,
21:02and if you look at the boots themselves, they are similar to UGGs, but not marked as UGG.
21:08Counterfeiters cleverly mask the fake branding.
21:12This boot came in with that type of label. The officers ripped the label off, and underneath
21:17is a trademark logo of UGG. The bottom of the boot had this type of sole. The officers lifted it
21:22off,
21:23separated the glue, and there is an unlicensed importation of the UGG trademark.
21:28The cops get wise, fakers bob and weave, and across town, some fake bling is changing hands.
21:35Now, you know, all the stuff is all Swiss main movie.
21:40So you're gonna love that. Now, if you want, we could also ice that out.
21:44You know, we could do it like that.
21:51The watchman sells fake watches and chains, but he doesn't import them.
21:56He buys legit components and makes them himself. He figures he's giving value for money.
22:03I always tell my clients why spend $45,000, $50,000, spend $10,000, $12,000. I'll get you the
22:10same exact watch,
22:12same exact feel.
22:19Only they're not the same watch.
22:23They're fakes.
22:27The best counterfeit bling he claims that money can buy.
22:31In fact, the watchman hypes his products so much, he seems to believe his own rap.
22:37The real Audemars Piguet is identical. Not a difference at all. Original price, real watch,
22:43about $47,000. I'll give it to you, $4,500.
22:47For the watchman, attention to detail is everything.
22:54We replicate every watch to be identical, grade A, no mistakes, no flaws. We set the storms
23:02exactly how the original watch is designed to be.
23:09The diamonds sparkle, and the gold as a hallmark. None of it's genuine.
23:16This here's a 14-carat stamp, as you can see, where we stamp everything official,
23:20from the watches, to the bracelets, to the rings, to the earrings, to the custom grills.
23:26No one could possibly get anything stamped unless you're in this inside jewelry world.
23:33The fake gold chains and jewelry only become illegal when he brands them.
23:40The watchman claims his bling watches and fake jewelry are in high demand.
23:45Money-wise, my gross in a week, a good week, about $18,000 to $25,000. I tripled my money
23:52up three times.
23:55So you want it? Yeah. Yeah, of course.
23:59The watchman closes the deal.
24:02Please give me a deposit.
24:09My clientele consists from your local street drug dealer, boxers, people that I deal with personally in the music industry,
24:17NBA players.
24:18No one will ever know unless you tell them it's fake.
24:21The watchman perfected his sales technique in the drug game. He swapped rocks of crack for fake rocks.
24:30Too many of my fallen brothers grew up around the bloods, grew up around gangs, and it was either jail
24:36or, you know, laying in a coffin.
24:44For Tommy Vuitton, knockoffs are a giant leap up from drug dealing.
24:50I'm no drug dealer.
24:52I came from the streets, but I worked my way up to do the right thing by opening businesses.
24:57And I'll try to make myself comfortable, the way I can live, the way I can take care of my
25:01family,
25:02that nobody can say, oh, he's out here being a drug dealer.
25:05All they can say is, oh, he's out here selling clothes.
25:08He's selling pocketbooks.
25:09He's doing something positive.
25:10He ain't trying to do nothing negative.
25:12If I'm selling drugs and selling clothes, that's a big change.
25:17That's a big change.
25:18Because once you change from drugs to clothes, that means you're trying to change your life around.
25:24You ain't trying to go to jail for 100 years.
25:26Tommy runs a crooked business, but he still has responsibilities.
25:30I got about 50 or 60 people employed.
25:33They got jobs.
25:34They take care of their family.
25:35If the business is slow, they still get paid.
25:40Tommy faces all the risks of a legitimate businessman, and then some.
25:45Risk number one, clearing customs.
25:50I lose about 7%, $40,000, $50,000 worth of stuff.
25:55It don't wipe me out.
25:57I still make ends meet.
26:01Risk number two, getting busted.
26:05You will get locked up for counterfeit.
26:07That's for one.
26:09And if you got a lot of it, you're going to jail for a pretty long time.
26:14But if you got some teddy moat, you got a little vendor, a little *** that got it.
26:18They don't get in there.
26:19They get a little, they go to jail, the judge let them go, go home.
26:22A little five, a little five, a little three days community service.
26:26That's it.
26:27When you get caught with a mother-in-law, you're going to the feds.
26:31The way they're doing with this counterfeit s***, they don't want nobody to eat.
26:34If the government ain't eating off of it, they don't want nobody eating off of it.
26:3970 months, 90 months.
26:42Well, if you don't know what 90 months and 70 months is, do the math on the calendar,
26:46because that's a lot of years.
26:48Risk number three, trusting your supplier.
26:52And they figure, if you got a little bit of money, we got some s*** for you.
26:56If you got a lot of money, we got some better s*** for you.
27:00If they send me some s***, well, I got to just deal with the s***,
27:04because I ain't going to take it back.
27:06I'll just have to sell the s***.
27:08If they send me some deep quality s***, I just have to sell the deep quality s***.
27:12Because me giving it back, I'm going to lose everything.
27:22So you got to trust somebody sometimes, so I trust them.
27:25They eating, I'm eating, the streets is eating, everybody's happy.
27:34Back at JFK Airport, a consignment of panels has caught the eye of inspectors.
27:41The panels appear innocent enough, but the CBP knows that looks can be deceiving.
27:49This is the new money maker in the black market.
27:53Production and shipping costs are minuscule, and the returns, spectacular.
27:59Toys R Us.
28:01Looks like what we have here is a bunch of blank credit cards
28:05that were concealed within what was supposed to be just a wooden shelf.
28:10All they need now is to just go online,
28:12buy the data from whatever hacker site has all the data for sale,
28:17and they emboss in the numbers, and you'll have a fully functioning Bank of America card.
28:23These cards are almost flawless, but the hologram is not quite perfect.
28:28The fakers will be working on that.
28:31A few months ago, we were actually seizing the embossing machines
28:34that actually print the raised lettering on the credit cards.
28:37That they can go out to the stores and just start buying whatever they want.
28:51The card fraudsters are also shipping to Australia, the Middle East, Canada, Europe, and Japan.
28:58In 2013, counterfeit card fraudsters embezzled over $12 billion from customers' accounts worldwide.
29:06Bank card fraud is growing each year.
29:09Anywhere between 500 to 700 concealed credit cards in this particular single shipment here.
29:16Recently, they arrested an organized crime ring,
29:18and they literally have an army of minions that run out there and try to hit these ATM machines
29:22as soon as possible before the banks realize what's going on.
29:25And they actually were able to withdraw over $7 to $10 million in cash
29:29from various ATMs spread out around the city.
29:32They've got hundreds and hundreds of attempts to just get it right once.
29:43Open that gate. Thank you.
29:46In the secure yard of the New York, New Jersey port,
29:50CBP officers have identified a suspect container.
29:57The X-ray imaging does not match the manifest.
30:01That container will be upgraded for a physical examination.
30:05It will be moved from this facility into the warehouse where it will be taken out.
30:11The merchandise will be devanned, removed from the container for a physical box-by-box examination
30:17until we get satisfied by our officers.
30:19While the CBP uses a combination of high-tech and old-fashioned detective work
30:24to stop the flow of counterfeits, Tommy Vuitton has managed to get another consignment through.
30:33For Tommy, the New York knockoff pirate, counterfeit is still the best hustle in town.
30:39This one here is leather. You can tell. They give you a tag for it.
30:48This is A-plus.
30:53You can look at the inside. You look at the loo. You look at the buckle. This is A-plus
30:57right here.
31:00It's all about the money. The business is just too good to quit.
31:04Have I ever been arrested for it? Yes, I have.
31:07Have I ever had to get bailed out for it? Yes, I have.
31:11Have they ever took my merchandise? Yes, they did.
31:14Have they ever took my merchandise and didn't show it in court? Yes, they did.
31:24It is a parasite on legitimate commerce, and it drains away money that we rely on as a society.
31:33We have our customs and border patrol evaluating and watching everything that comes into the country,
31:38and when they do that, they're doing the best they can, but they can only get to a small portion
31:42of
31:42the containers. There's just too much commerce coming in. We'd shut commerce down if we stopped and
31:47inspected everything. So they're not allowed to stop all of it until they check it all. So they do the
31:51very best they can, and a lot gets through. You're talking about multi-trillion dollar industry coming
31:56into the United States, and so we just don't have enough people.