NYC Council Debates Crackdown on Fake Luxuries

NEW YORK (AP) -

Bargain hunters from around the world flock to Manhattan’s Chinatown for legally sold bags, jewelry and other accessories bursting onto sidewalks from storefronts along Canal Street.

But hidden around the city are goods labeled “Prada” or “Louis Vuitton” or some other luxury brand — counterfeits sold for a pittance. In some cases, handbags going for $2,000 on Fifth Avenue can be had downtown for, say, $20.

Following a police crackdown, some New York shops use stealth tactics to keep sales rolling. Asked if he carries “designer bags,” one merchant points to a knockoff on a shelf, explaining that he “can make it into a designer bag if you wish.”

He steps behind a curtain, emerging with a metal plate bearing the name “Prada.” He says he’ll put the label on whichever bag a customer picks.

If caught, peddlers typically spend a few days behind bars, pay a fine and get their goods confiscated. And then they’re on the street again.

But if a proposed bill passes the City Council, law enforcement will go after the buyers instead. Customers caught buying counterfeits could be punished with a fine of up to $1,000, or up to a year in prison.

Council member Margaret Chin, who introduced the bill, said at a public hearing Thursday that counterfeits deprive the city of at least $1 billion in tax revenue a year. The Democratic lawmaker expects a vote sometime in the coming months.

“Hopefully, this law will cut down on demand,” she says.

But Councilman Peter Vallone Jr. (D-Queens) said he would not support the bill since “a year in jail seems a little tough” for buying fake goods.

“How would I know I’m not supposed to buy something, that there’s a fine?” said Ashley Hunter, 30, of Kershaw, S.C., who was browsing at a stall selling scarves.

In France, everyone seems to know that buying or carrying fakes is a crime, says Valerie Salembier, who runs Authentics Foundation, dedicated to consumer education about the counterfeit industry. She testified at Thursday’s hearing.

Air France warns tourists to stay away from fake goods, because anyone in the country “risks fines of up to 300,000 euros” — that’s more than $478,000  — “and up to three years in prison for the mere possession of a counterfeit item.”

“It’s why they don’t have a big problem with counterfeits in France,” Salembier says.