Mirabelle Vargas, 29, winds her way through the open-air stalls in
downtown Los Angeles’ bustling Santee Alley, hunting for Victoria’s
Secret underwear.
Or at least undies with a tag that says Victoria’s Secret.
An authentic pair from the lingerie maker can cost $7.50 and up. But
Vargas, a retail sales clerk, managed to find a table brimming with
pink-and-white unmentionables. Price: two bucks a pop.
“Of course they’re not real, not at this price,” said Vargas, decked
out in a chocolate-brown Victoria’s Secret tracksuit, also counterfeit.
“But the quality isn’t bad, and buying fakes saves a few bucks. You can
find fake everything here.”
Not that long ago, counterfeiters focused almost exclusively on upscale
brands like Prada and Gucci. But five years of a weak economy has
knockoff artists churning out goods for people with more modest tastes
and budgets.
At Santee Alley and other locations, you can find fake versions of
shirts, pants and footwear by brands such as Gap, Dickies and Vans.
“You are seeing stuff now you can find at Target, not just stuff you
can find at Macy’s and Neiman Marcus,” said Lt. Mathew St. Pierre of
the LAPD’s commercial crimes division. “Five years ago, we wouldn’t
have seen $10 and $15 T-shirts being counterfeited like we do now.”
St. Pierre said police are aware that counterfeits are being sold at
Santee Alley and investigate regularly, but he added that combating
knockoff artists is a constant battle fought with limited resources.
No one keeps numbers, but fashion industry experts say cheap fakes have
exploded in recent years, especially in California.
“It’s a huge problem because we are inexpensive fashion brands,” said
Ilse Metchek, president of the California Fashion Association. “We are
Mecca for that. We are not Calvin Klein or Donna Karan. We are fast
fashion. You can copy it within a week of appearance in retail stores
and slap a label on it.”
The economy is one reason for the trend. “The recession has more people
trading down,” said Susan Scafidi, academic director of the Fashion Law
Institute at Fordham University’s law school. “Even lower-priced brands
feel like a stretch in this economy, and people are more likely to
trade down to counterfeits.”
There are several other factors driving the low-rent-counterfeit trend,
including the Internet, a changing consumer mind-set and beefed-up
anti-counterfeiting efforts by the giant apparel companies.
The big luxury brands have cracked down hard.
Last year, fashion label Tory Burch won $164 million in a lawsuit
against a group of cyber squatters peddling fake shoes, purses and
accessories. Chanel filed suit in September against 399 websites
allegedly selling knockoff sunglasses, wallets, jewelry and other goods
bearing the luxury retailer’s name.
But with slim budgets and few employees, small brands can’t afford
legions of lawyers and private detectives, making them less-risky
targets for counterfeiters.
“It’s a business-expansion strategy for the bad guys,” said Tom Taylor,
president of brand protection for OpSec Security, a Boston firm that
monitors counterfeiters. “The downturn left a lot of capacity open in
factories in China and other parts of Asia, so they are coming up with
ways to fill that capacity.”
Shoppers themselves, meanwhile, are another factor. A low-paid clerical
worker might have a hard time passing off a $10,000 Hermes tote as the
real thing. But who would ask questions about $44 Toms shoes?
“When you’re talking about middle-market brands with middle-of-the-road
price points, you don’t have that stigma about counterfeits, people
being suspicious about fakes, because the real thing isn’t that
unattainable,” said Caleb Westbay, vice president of sales at Ed Hardy,
a Los Angeles tattoo-themed street-wear brand.
Until its worldwide licensing rights were sold last year, Ed Hardy had
a dedicated anti-counterfeiting team that worked with the police to
identify and track down knockoffs. In 2006, the brand started sewing
anti-counterfeit strips onto its clothing labels, similar in idea to
the security strips that go into dollar bills, Westbay said.
“Counterfeit goods look authentic. Everything from quality and
execution of product down to packaging and labeling and all that
stuff,” Westbay said. “It’s tough to fight.”
These cheaper items may ultimately make more money for counterfeiters
than their luxury cousins because it’s easier to sell vast quantities
of the lower-priced items. Many more people are likely to buy $15
counterfeit hoodies and sweat pants than shell out $100 for a fake
Louis Vuitton handbag.
“If there is profit to be made, things will be counterfeited, and it
goes so far beyond luxury goods in terms of what is actually being
counterfeited,” said Christine Hogue, who monitors counterfeits as an
import advisory specialist for the U.S. Customs and Border Protection
agency at the Los Angeles and Long Beach ports.
The Internet has enabled counterfeiters to further elude authorities by
cutting out the middlemen and selling directly to shoppers. The most
ambitious counterfeiting websites have taken to copying photos and
trademarks and registering dozens of domain names similar to the
brand’s official website. Many shoppers, groomed by deals sites to
expect heavy discounts, are duped into thinking they’re buying the real
deal, said Scafidi of Fordham University.
“The Internet is a much bigger risk than the guy setting up a table
with handbags,” said Douglas Zarkin, vice president of marketing at
Kellwood Co., owner of urban fashion brand Baby Phat, which has dealt
with counterfeiters both online and off. “Technology allows people to
put up a very professional-looking face when they are not professional
people.”
That’s something Jeffrey Campbell, a Los Angeles company known for
colorful and edgy footwear, has experienced firsthand.
Last fall, customers began asking why shoes they had ordered were
taking so long to arrive, pointing to order numbers that Jeffrey
Campbell had no record of handling, said company spokeswoman Sharon
Blackburn.
The company investigated and discovered a handful of websites, with
names such as CheapJeffreyCampbell.com, masquerading as authentic
vendors and selling versions of the company’s popular Lita boot, which
retails for about $160, at a 60 percent to 70 percent discount,
Blackburn said.
The red flag: Some of the sites were peddling shoe styles specially
created for clients and produced in very limited quantities, Blackburn
said. Shoppers forked over their credit cards and received nothing.
But there was little the company could do besides report the sites to
PayPal and urge shoppers to be careful.
The company previously had seen counterfeits of its shoes made by a
Chinese manufacturer being sold on EBay.
“Our loyal customers can tell the fakes and they don’t want them,”
Blackburn said. “But we are not an Apple or Chanel or Gucci. Those are
so recognizable that people immediately know the brand and the
possibility that it’s a knockoff.”
