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by Tim Phillips

Kogan Page © 2005, 246 pages, $29.95 (ISBN 0-7494-4379-0).

The Deadly Trade in Counterfeit Goods

Maybe that fake Rolex watch your friend recently bought in Beijing that he proudly displays as a symbol of his international cunning didn’t hurt anyone, but business journalist Tim Phillips explains that the growing knockoff economy has many crimes and bodies in its wake.

According to the World Customs Organization, the global trade in fakes is currently worth about $512 billion, or 7 percent of the world’s trade. To show how quickly it has grown, Phillips points out that it was $5.5 billion in 1984. In Knockoff, he writes that this knockoff economy is “a criminal empire of huge proportions.”

Although counterfeiting is an illegal business that is thousands of years old, today’s business conditions have never been better for it. From the increase in manufacturing to the spread of the Internet to the lowering of global trade barriers, the international counterfeit economy has been booming since 2001. Phillips also explains that organized crime has increased its counterfeiting operations due to tightened banking rules that have forced it out of banks and into the very profitable world of illegal imports.

Accomplices to a Crime

Phillips writes that those involved in the illegal trade of knockoffs are “accomplices to a criminal network that costs thousands of jobs, retards developing country economies, kills and maims thousands of people a year, breeds corruption and bribery, has become the cash cow that funds serious crime and violence, and one day might even kill you.”

Although some might see no harm in buying a knockoff handbag, there are many more insidious aspects of the trade in knockoffs that must be considered when discussing its negative effects on society. For example, Phillips explains, fake pharmaceuticals, brake pads, and airplane engine parts can all lead to tragedies when they go undetected.

Intellectual property comes in the form of patents that represent new and useful ideas, and copyrights that protect creative people from having their creations copied. This concept stems from the idea that if you think of a novel way to do something, create a better product, or design something in a more beautiful or efficient way, you should reap the benefits of your talent.

Counterfeiting, on the other hand, uses someone else’s intellectual property for profit. This can also be defined as stealing. In Knockoff, Phillips describes why readers should care about counterfeiting, who gets robbed, and who gets hurt or killed because so many people enter into the knockoff culture with little concern for the underlying issues.

The ‘Informal’ Economy

Knockoffs hurt people in many ways, Phillips writes. For example, the International Labor Organization reports that most of the world’s 246 million child laborers work in the “informal’ economy that is hidden from regulation by the authorities. Phillips also writes that vodka containing methyl alcohol killed 60 people in Estonia in 2001.

By examining the global network of buyers, sellers, shippers and wholesalers who deal in counterfeit products, Phillips uncovers the distribution networks that have allowed everything that can be faked to enter the commercial world. From “Counterfeit Alley” in Manhattan to Beijing’s Silk Alley to Northern Ireland’s Sunday markets, Phillips exposes the people who sell illegal knockoffs from unmarked warehouses, purse parties and the backs of cars, as well as those who supply the illegal handbags, watches, clothing, golf clubs, sunglasses, etc. He also presents the insights of the officials who are charged with the difficult task of finding the sources of these illegal goods and shutting them down.

By showing the lengths to which criminals will go to sell their wares, Phillips fills the discussion of counterfeiting with the details that bring immediacy and import to this growing international problem and its players. ~

Why We Like ThIS Book

Knockoff demonstrates how the seemingly innocent buying of a knockoff is actually completing a vicious cycle that relies on theft at the least and murder at its worst. Phillips’ keen journalistic eye for the dramatic twists involved in the trade of counterfeits and his ability to turn a real-life crime story into a compelling tale of business treachery that affects a great many people make Knockoff a fascinating read. ~

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