E-commerce counterfeiting is the largest criminal enterprise in the world and the US is the largest market

While trademark counterfeiting has been around for many years, the scope of the problem has changed dramatically with the advent of online shopping. The sale of goods in online marketplaces, both licit and illicit goods, has grown exponentially in the past decade;3 and particularly since the onset of COVID-19, consumers have increasingly shopped online.4

The United States leads the world in total e-commerce sales and business to business sales, and is second in the world in business to consumer sales.5 With virtual storefronts and easy online transactions, online marketplaces give businesses of all sizes the opportunity to achieve global profits and reach previously inaccessible consumers, and also give consumers access to products delivered to their door that they might not be able to find in local markets.

However, counterfeiters also take advantage of the opportunity online marketplaces provide them and rely on the brands’ goodwill and reputation to create counterfeit products to reach often unwitting consumers. The sale of counterfeit goods remains low risk to the counterfeit sellers-much lower risk than selling in a brick-and-mortar venue. Counterfeit items previously sold in flea markets and on the street or in bodegas are now sold in volume on online marketplaces, social media pages, apps, and the dark web.6

The volume of counterfeits is staggering but also difficult to measure for a variety of reasons. First, it is an illicit activity that is often focused on deception. Second, the most accurate data we have is from seizure data. The U.S. Customs and Border Protection’s Intellectual Property Rights Seizure Statistics report for the 2021 fiscal year reported that CBP had 102,490 seizures with an estimated manufacturer’s suggested retail price (MSRP) of over $3.3 billion.7 The size of the problem is often calculated based on seizure data, or takedown data, which does not fully reflect the universe of counterfeit goods.8 Third, data sharing between brands, platforms, law enforcement and academia has always been a struggle. However, despite these limitations, estimates of counterfeiting profits globally by Global Financial Integrity state that it is financially the largest criminal enterprise in the world, approximately $923 billion to $1.13 trillion a year—a higher amount than either drugs ($426-652 billion) or human trafficking ($150.2 billion).9 Financially, counterfeit goods impact national economies; counterfeit and pirated goods in international trade have been estimated to amount to as much as USD 464 billion in 2019, or 2.5% of world trade that year.10