NYC debates crackdown on counterfeit luxury goods

Published on NewsOK Modified: June 13, 2013 at 4:32 pm •  Published: June 13, 2013
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NEW YORK (AP) — Bargain hunters from around the world flock to Manhattan's Chinatown for bags, jewelry and other accessories bursting onto sidewalks from storefronts along Canal Street.

Among the goods are luxury items labeled "Prada" or "Louis Vuitton" or some other luxury brand — counterfeits sold for a pittance. In some cases, handbags going for $2,000 on Fifth Avenue can be had downtown for, say, $20.

They're seductive fakes.

Until now, the law enforcement focus has been on catching the sellers. But if a proposed bill passes the City Council, customers caught buying counterfeits could be punished with a fine of up to $1,000, or up to a year in prison.

The New York City legislation, if passed, would be the first in the United States to criminalize the purchase of counterfeits.

Council member Margaret Chin, who introduced the bill, said at a public hearing Thursday that counterfeits deprive the city of at least $1 billion in tax revenue a year that could support community improvements. What's more, she says, the counterfeit trade has been linked to child labor and the funding of organized crime and terror groups.

"For tourists, it's fun, it's a bit of adventure," Chin says. "We have to let people know that if you engage in this activity you are committing a crime."

On the street, day after day, sellers press their hard-sell routines.

"Rolex! Chanel!" a man on a street corner whispers someone walking by. "Get this before the police do!" he adds with a grin.

Buyers are walked to a designated spot where they're quietly shown photos of the desired goods. Choices are then signaled to another person who disappears to an undisclosed location — a vendor's back room, a nearby apartment, the back of a van.

The item arrives within minutes, and cash exchanges hands.

The counterfeit vendors are also a hassle for those who live in the area, says John Hagen, a resident there for the last 30 years. He says the counterfeit vendors have ruined his block.

"I walk out of my house every day into it," he says. "I'm sick of what this has done to our neighborhood."

Some at Thursday's hearing were concerned about how the new law would be enforced and whether it would hurt both businesses and buyers.

Among them was Kathleen McGhee, director of the Mayor's Office of Special Enforcement and the official in charge of the sting operations that have closed down 40 illegal stores in Chinatown since 2006. She testified against the bill, saying that showing a customer had knowledge that the goods were counterfeit will be difficult to prove in court.



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