In a country that prides itself on its fashion expertise, this operation was among the finest. An Italian-designer brand produced by dozens of craftsmen and plenty of warehouses to store the best quality leather shoes with a label that everyone wants to buy.
Only problem was the label was a fake.
A few days ago Italy’s Guardia di Finanza, the agency that fights fraud, raided 17 factories and warehouses around Naples and seized an incredible 600,000 shoes with the “Hogan” label destined for street vendors or naive consumers who do their shopping online. Twenty-nine people were arrested.
In the past 12 months raids from Milan to Taranto have delivered millions of euros in fake fashion merchandise. Raids and seizures are almost a daily occurrence.
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The Guardia di Finanza estimates there are about 100 million counterfeit products circulating in Italy a year and 3.7 million items of false clothing and accessories were seized in Italy in 2010 . But crime fighters are swimming against the tide.
“In the past 10 years counterfeiting of fashion brands and audiovisual pirate copies has become one of the new frontiers of organized crime,” said Fausto Zuccarelli, vice chief prosecutor in Naples . “Criminal groups operating in different countries around the world have become convinced that if they commit economic resources to this sector it will be extremely profitable.”
In January a raid in the Adriatic port of Ancona netted fake designer handbags bearing the French designer name “Louis Vuitton” as well as wallets and shoes with a street value of about €880,000. Only a week before that raid, almost 3200 fake luxury fashion items were seized in Naples when agents stumbled upon a shipment of handbags, shoes, and other items with false labels including Gucci, Chanel and Louis Vuitton.
From their home port of Naples, the clans of the Camorra have created a vast international network for producing and distributing fake fashion brands, cameras, high-speed drills and pirate copies of CDs and video games.
In a sinister development, they are now moving into contaminated food products such as olive oil and tomatoes and that has huge implications for consumers’ health across the globe.
“There has been a transformation — the movement of a large amount of money and economic investment on the part of organised crime into this sector,” Zuccarelli said.
For the big designer labels it is a challenge to stop the influx of fake products cutting into their business.
Versace, the Italian designer brand, made international headlines when it was awarded $20 million compensation in a landmark case in Los Angeles in 2010. Police arrested 110 people for various violations and 72 shops in California and Arizona were charged with selling fake Versace products.
But Filippo Beatrice, the man charged with fighting the Camorra at a national level, said far more needs to be done. Beatrice, who was born in Naples, is a senior prosecutor at the National Anti-Mafia Directorate (DNA) and has been investigating the Camorra since 1997.
“This is an emergency,” Beatrice said in his Rome office. “This market no longer has any boundaries and there needs to be a common international approach to fighting it.”
Beatrice spoke of a vast international network of production and distribution where fake items are systematically imported from China or produced in Italian factories, often by illegal immigrants, and then moved throughout the world .
In 2004 Beatrice led a Naples inquiry that uncovered the extent of the Camorra’s vast empire after discovering a member of its notorious Secondigliano clan had opened a shop in the German city of Chemnitz, near the Czech border.
From this innocuous discovery prosecutors used wire taps and state witnesses to uncover a vast chain of counterfeit production and distribution extending through Germany, France, Portugal, and Spain, to the UK, Canada, the US and even Australia.
Beatrice said the clans not only make a fortune from fake designer brands, the network of shops and street sales gives the Mafia a cover for laundering massive drug profits.
But he warned that crime-fighting agencies fail to recognise the extent of the problem.
“The legal penalties for trafficking fake products are far less severe than for drug trafficking,” Beatrice says. “The reality is that there is not a very high international awareness of the issue like there is for drug trafficking and the penalties it carries. In many countries the crime of ‘association’ also does not exist.”
Laws have been beefed up in Italy. Under changes introduced in 2009 the crime of “Mafia association” which carries heavy penalties is now applied to counterfeit crime and regional investigations have been centralised in Rome.
And what about those who are most under threat? Although Louis Vuitton employs a team of lawyers to fight the counterfeiting of its famous monogram and Versace won its US lawsuit, most are remarkably silent about the issue.
Perhaps it’s worth recalling Roberto Saviano, author of bestselling book Gomorrah, who said the major fashion brands only protested against the Camorra clans’ fake products after Italian investigators exposed them.
“Denouncing them would have meant forgoing once and for all their cheap labor sources in Campania and Puglia,” Saviano wrote. “The clans would have closed down access to the clothing factories around Naples and hindered relations with factories in Eastern Europe and Asia.
“And given the vast number of shopping centers operated directly by the clans, denouncing them would have jeopardised thousands of retail sales contacts.”