As the number of counterfeit shoes continues to increase, trading officers around the world are working overtime to keep the counterfeit market under control. Shoes were the number one clothing item seized by United States customs officials and Homeland Security officers in 2008.
Selling and purchasing counterfeit goods is illegal, and both vendors and consumers can be prosecuted. Arrests of tourists purchasing fake designer pumps and handbags along the Italian Riviera have become increasingly frequent. Most of the time consumers know when they are purchasing a fake; they seek out a pair of fake Gucci pumps or fake Chanel ballerina flats as an inexpensive alternative to owning the real designer item. But as the manufacturing of counterfeit items becomes more sophisticated, an increasing number of consumers who think they are purchasing the real deal are actually being duped. Many counterfeit shoes to hit the US market are actually manufactured at the same factories where the genuine shoes are made.
New Balance, for example, went to court with one of the owners of its factories outside of Hong Kong after they discovered the factory had been making hundreds of thousands unauthorized “New Balance” shoes. Counterfeit shoes that are manufactured at the same factory as the genuine product are said to be made during the “third shift” or “midnight shift”. The nickname is apt. Often a Nike or other brand name factory will shut down in the evening and then reopen in the middle of the night to produce counterfeit shoes using the same equipment.
In September of 2006, United States Homeland Security officers seized more than 135,000 counterfeit Nike running shoes. These 135,000 pairs of shoes had a reported retail value of 16 million dollars. The shoes were being smuggled into the United States from China in 15 large shipping containers. Six people have been arrested in this international counterfeit scheme, which included smugglers from China, Mexico and the United States. They had hoped to smuggle the shoes into the United States using fake documents. They are now facing up to 5 years in prison and a fine of 250,000 dollars. The US Homeland Security and Justice Departments are describing this as one of the largest counterfeit smuggling rings uncovered in recent history.
Nike and other companies who outsource their labor to Asia are prime targets for counterfeit manufacturing schemes. In addition to the counterfeit shoes being smuggled into the United States in large quantities, the fake shoes are often imported (sometimes unknowingly) by individuals who purchase them over the Internet.