The impact of counterfeiting on the common man

Many people don’t take the crime of counterfeiting seriously, they think that counterfeiting will not impact their lives, however, the fact is that counterfeiting has many negative impacts on the common man and thus has been named as the ‘Crime of the 21st century by Federal Bureau of Investigation.

On the global scale, the value of counterfeiting has reached a high of approximately 1 trillion dollars whereas, in India, the figure has shot up to I lakh crore annually. These figures clearly show the grim scenario of the situation.

Counterfeiting not only impacts the global economy but is a challenge for the governments, business organizations and most importantly the consumers. Counterfeiting not just dupes the consumer of his hard-earned money but also affects his health, besides this, there are many far-reaching impacts of counterfeiting on consumers. Let’s discuss the same.

Negatively affects the consumer’s health: What could be more dangerous than a counterfeit life-saving drug. Counterfeit medicines have created havoc in the industry, and it has become increasingly difficult to control them. Counterfeit or substandard medicines can have serious side effects on the human body and in some cases can even lead to death.

Dupes the consumer financially: Consumers who unknowingly purchase fake goods have to pay an actual price for a counterfeit. While it may sound good to purchase an original product at high prices but for a counterfeit, it is not at all good in any sense as you have compromise on quality.

Creates unemployment: There is a clear link between the rise of counterfeiting and the rise in unemployment. The business of counterfeits leads to monetary losses for the manufacturers which in turn affects the expenditure on current and future employees.

Poor infrastructure: Today’s common man needs beyond ‘roti, kapda, and makaan’. The government spends a good amount of money every year on rural and urban infrastructure. This money is collected from the taxes levied by the government on the business organizations and the common man. Since counterfeits evade taxes it leads to a drop-down in the money spent on infrastructure and development.

The use of integrated anti-counterfeiting technology against fake products

The value of global counterfeiting has reached to trillions of dollars. Not just developed nations but also the developing countries are facing the problem of fake products. Counterfeiting leaves a negative impact on the government exchequer, company’s profits and the consumers. In the past few years, government authorities and companies are taking stringent measures against counterfeiting.

E-commerce giants like Amazon and Alibaba have initiated anti-counterfeiting measures to deter counterfeiters from selling fake products on their platforms. Governments across the world have also implemented strict laws to deal with counterfeiters and their chain of networks. We regularly come across news from different parts of the world about the seizure of counterfeit or fake products by authorities.

The growth of counterfeiting has drastically changed the use and implementation of different anti-counterfeiting technologies. As forgers and counterfeiters use more sophisticated technology to copy the product and its packaging, it has become imperative to use new measures against them.

The integration of different anti-counterfeiting technologies is gaining immense popularity amongst manufacturers and other stakeholders of the supply chain. The fusion of holography along with digital authentication has made products highly secure against the threat of duplication. Holostik is a renowned name in the field of anti-counterfeiting technologies.

We believe in constant R&D and innovation to stay ahead of counterfeiters. Our smart security holograms and security labels are the perfect examples of integrated anti-counterfeiting solutions. In these anti-counterfeiting products, we have collated the efficacy of OVD with the prowess of QR/bar code.

Acting as a double-edged sword against counterfeiting our integrated solutions provides a two-level of authentication, making it highly impossible to replicate our features. Today, we are providing a wide range of anti-counterfeiting products and solutions to more than 10,000 clients in 75+ countries. If you want your products to remain safe from the problem of counterfeiting then call us on +91–785-785-7000 or mail us at connect@ec2-54-210-245-44.compute-1.amazonaws.com.

How product packaging can be made impeccable in context of security

Product packaging is an important step in ensuring maximum safety of products from tampering, theft and other forms of counterfeit. A coordinated and secure packaging framework coupled with a reliable track-and-trace system is key in supply chain security.

In a world of digitalized logistics and e-commerce, the physical security of products is no longer a supplementary layer of protection but a necessity.

Counterfeiters today operate on a larger scale than ever before, with entire factories featuring advanced technology focused on creating perfect copies of products provided by well-known brands or manufacturers. Trusting the entire supply chain security to a supposedly strong legal framework and the precaution of consumers is simply not a good strategy.

A sound supply chain security strategy would involve a proactive approach in implementing technology that allows manufacturers to track their products throughout their distribution chains and a packaging system that makes it impossible for counterfeiters to tamper with the products or replace them with cheap knockoffs within the legitimate supply chain.

Authentication solutions

Authentication in packaging is usually achieved with sealing and holograms. Depending on the level of security required, sealing and holograms could have advanced security features such as pressure-sensitivity, customized tamper-evident fracture patterns, a blacklight verification system, and machine-readable entrenched code.

These are sometimes heat-sealable and may be applied directly to product containers using induction seal technology, making it tamper-proof. Multiple films may be applied to form a single holographic seal that provides a high level of defense to containers or bottles.

Nano-optical technology

The use of nanotechnology in product packaging highly elevates the unlikelihood of counterfeit interference and solves the many limitations associated with synthetic packaging techniques.

Managed microstructures and nanostructures on technologies such as holograms offer features such as water resistance, heat stability and tamper-indicative change of color that cannot be reversed.

Tamper-evident packaging systems

Tamper-evident packaging systems may include solutions like wide-web films, holographic shrink sleeves, and security pouches. The tamper evidence feature maintains product integrity by preventing repacking or reselling of the items.

Figure: Example of a shrink sleeve

Shrink sleeves are a leading packaging application in industries such as food and beverages, cosmetics and detergents. These are heat-sealable and conform to the shape of containers making it harder to tamper with. Tamper-evident shrink sleeves come with microstructure holographic authentication for advanced security.

Figure: Example of a wide web film

A wide web film is a holographic film with a characteristic design covered securely around a product or product container. To open the container and remove the product, the film must be cut or torn.

These holographic laminated films offer a completely non-invasive solution to prevent any sort of tampering and are used extensively for flexible packaging. These films vary in thickness and may come in PET (12 microns) or BOPP (20 microns).

Security pouches provide external tamper evidence and can be combined with the internal seals for double security. These usually involve rotogravure printing technology and the highest level of optical security features.

Tamper-evident packaging systems take the high-security value of nano-optical and holographic authentication solutions and combine it with high-quality printing and materials for a secure and appealing protection solution that increases product security and enhances the brand value.

For more on shrink sleeves, security pouches and wide web films, click here. To find the ideal product packaging solution for your business, click here.

The negative effects of counterfeiting on the economy

Counterfeiting is a trillion-dollar illegal business having its presence in almost every part of the world. Today, counterfeiting is posing a threat to not just the consumers but also to the economic growth of the nations.

According to an OECD and EUIPO report, “Global sales of counterfeit and pirated goods have soared to 460 billion euros ($522 billion) a year, amounting to a whopping 3.3 per cent of world trade.”

The report also states the nations most affected by counterfeiting which includes the United States, Japan, South Korea and the EU states. However, the effects of counterfeiting are not just visible in developed countries but are also hampering the growth of the developing world.

Let’s discuss some of the impacts of counterfeiting on the economy of a country:

Evasion of taxes: Counterfeiting leads to evasion of taxes. The mammoth counterfeiting industry sells its products in the market without paying taxes to the government. This leads to a loss of the government exchequer and finally, the government is not able to spend enough on welfare projects and schemes.

Rise in unemployment: Since the counterfeit industry takes away the profits of credible companies, they are not able to recruit new employees. The financial instability of the industries creates massive unemployment which is linked indirectly to the problem of counterfeiting.

Diminishes foreign investment: It has been generally seen that countries with weak IP laws and poor regulatory measures become the breeding ground for counterfeit activities. Such countries blur their chances of foreign investments. Counterfeiting diminishes the chances of foreign direct investments and thus block the economic growth of a country.

Fuels other black-market activities: Counterfeiting fuels other black-market activities and is a lucrative business for organized criminals. With the money acquired from the sale of counterfeits, they fund their vast network, which is involved in drugs trafficking, human trafficking, illegal arms, prostitution etc.

Finally, we can conclude that counterfeiting has multiple negative effects, which are very harmful to the economic growth of the country if not checked on time by authorities and the respective governments of their countries.

To get the best anti-duplication and products and solutions call us on +91–785-785-7000 or mail us at connect@ec2-54-210-245-44.compute-1.amazonaws.com.

The link between counterfeiting and organized crime

International law enforcement and market experts have established a close link between counterfeiting and other forms of criminal activities. It has been found that the counterfeiting business helps criminals to fuel other illegal activities and vice-versa. EUROPOL (European Union Agency for Law Enforcement Cooperation) has even warned that counterfeiting is an increasingly attractive avenue for organized crime syndicates to diversify and increase their illicit businesses.

It has also been found that counterfeiters use similar routes and modus operandi to supply counterfeit goods as they do to smuggle drugs, firearms and human trafficking. Profits from other crimes and illicit activities also help in the production and distribution of counterfeit goods. Many reports from different countries have established the fact that profits from crimes like drug trafficking and other crimes were used to promote the business of counterfeiting and, similarly proceeds from the sale of duplicate goods were used to promote the criminal’s other illicit activities.

One of the main reasons why criminals choose counterfeiting over other criminal activities is due to its favourable ratio between potential profits and possible risks. According to Executive Director, UNODC (United Nations Office on Drugs and Crime) Yuri Fedotov, “In comparison to other crimes such as drug trafficking, the production and distribution of counterfeit goods present a low-risk/high-profit opportunity for criminals. Counterfeiting feeds money laundering activities and encourages corruption. There is also evidence of some involvement or overlap with drug trafficking and other serious crimes.”

As per trade, reports counterfeiting is now placed amongst the highest income sources for organized criminal activities. Counterfeiting or duplication also helps in money laundering by providing a platform through which criminal organization can invest the proceeds of their illicit activities. In a nutshell, organized crime syndicates use counterfeiting as a medium to optimize their other criminal activities.