Instagram, Organized Crime’s Online Market for Fake Goods and Counterfeit Swag

The counterfeit market directly affects many brands and companies, often resulting in profit loss and employee layoff, thus damaging entire supply chains. It undermines development and research work at global levels, could endanger buyer health, and even harm relationships between governments and companies. It also means local authorities can’t collect state or revenue taxes on the goods, resulting in fewer resources to invest in the common good.

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While the internet has brought many rewards to our personal and collective life, several high-tech giants have also gained a tremendous amount of power, including Facebook, Amazon, Google, Alibaba and Instagram. Counterfeit criminals are using the same common and widespread tools provided by these companies to attract consumers, to showcase and sell their illicit wares, and to transfer money into the open. These organizations use a variety of online options and platforms to better provide a safer, more efficient and more profitable “user experience”. Particularly on Instagram, they deploy advanced techniques (botnets, algorithms, etc.) to constantly flood the platform with ads and offerings about a wide range of counterfeit goods.

However, so far both governments and tech giants have shown an inadequate and unsatisfactory response to this growing phenomenon – as revealed by figures gathered in a matter of a few months by our research team. We identified over 20,000 Instagram accounts that posted more than 14 million photos of counterfeit goods. About 20% of the Instagram posts related to fashion brands feature illicit and counterfeit items. A trend that applies to most mobile social platforms. But throughout 2015, Google and WeChat blocked only 18,000 and 7,000 “suspicious” accounts. Almost 74% of these “salespeople” are simply using IM chat apps and 75% offer at least two contact methods. Most of these vendors are based in China, Russia, Malaysia, Indonesia and Ukraine, while the most affected brands are Chanel, Prada, Louis Vuitton and Fendi, along with Rolex and Cartier for luxury watches.