Column: Online shopping vulnerable to stolen, counterfeit items

Ohio retailers continue to demonstrate incredible resilience amid the COVID-19 pandemic, ensuring that shelves are stocked and services continue while keeping customers and employees safe and healthy. But as retailers and grocers work to make sure families have what they need in this new environment, many are battling yet another crisis: criminal networks stealing mass quantities of in-demand goods and then selling those stolen products on third-party marketplaces like Amazon.

This problem — known as organized retail crime — is not new in Ohio. In fact, a sophisticated theft ring targeted central Ohio beauty stores as part of a scheme to steal high-end cosmetics and fragrances back in February. Now, though, with more people shopping online than ever, criminals are becoming even more aggressive in their efforts to acquire stolen items — posing increased risks to both workers and consumers as well as our local businesses.

And the problem goes even deeper than stolen goods, as knockoff products designed to deceive consumers are flooding online marketplaces. Just last month, the U.S. Customs and Border Protection officers announced a massive seizure of counterfeit phone cases and fronts in Cincinnati, which would have been worth just over $374,000 had they been real. Criminals who are able to get away with these schemes are often able to get these products online and into the hands of unsuspecting consumers.

Fortunately, a proposal in Congress would make it more difficult for professional thieves and fraudsters to hide behind fake accounts and create an illegitimate business by anonymously selling their stolen and counterfeit merchandise on third-party marketplaces.

The INFORM Consumers Act, introduced in the House and Senate, has bipartisan support and requires online marketplaces to collect and verify a seller’s information —and require the seller to provide contact information to consumers. It’s a simple bill with a rather simple goal — increase transparency and accountability while giving consumers access to information.

This legislation will require marketplaces to properly vet who is selling on their platform, making it much more difficult for criminals to hide behind fraudulent accounts and peddle illicit goods. And it will better inform law enforcement, so that it can more easily identify and stop criminal activity.

To shield consumers from counterfeit and dangerous items and protect Ohio’s brick-and-mortar retailers from organized criminal attacks, Rep. Bob Latta should lead the effort to pass the bill. 

Ohio is far from the only state where organized retail crime has skyrocketed in recent years. Retailers across the country have been sounding the alarm for years, as have law enforcement agencies at the highest levels. In a January 2020 report titled “Combating Trafficking in Counterfeit and Pirated Goods,” the Department of Homeland Security warned that illicit goods trafficked to American consumers by online third-party marketplaces “threaten public health and safety.” 

The ability of criminals to quickly and anonymously set up accounts on third-party online marketplaces, the report concludes, “greatly complicates enforcement efforts, especially for intellectual property rights holders.” It also “allows counterfeiters to hop from one profile to the next even if the original site is taken down or blocked.”

Amazon CEO Jeff Bezos was asked under oath before the House Judiciary Committee if he knew whether stolen or counterfeit products have been sold on the Amazon platform. His answer: “I’m sure that there have been.” Yet despite knowing that illicit goods are being sold on his company’s platform, he could not answer what information Amazon collects to verify a seller’s identity.

His evasive answer was telling. Amazon makes money each time a stolen or counterfeit good is sold via its platform. That’s why Congress needs to step in to protect the rights of consumers and pass the INFORM Consumers Act.   

Michael Hanson is the spokesperson for Buy Safe America Coalition, which represents retailers, consumer groups, manufacturers, intellectual property advocates and law enforcement officials who support efforts to protect consumers and communities from the sale of counterfeit and stolen goods.