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Archive for the ‘Counterfeit’ Category

More Than 1 Million China Counterfeit Parts Found in U.S. Weapons

Posted by Author on November 9, 2011

U.S. officials say a problem that has long plagued luxury handbag makers such as Gucci and Louis Vuitton is now afflicting the Pentagon’s high-end weapons systems: cheap Chinese counterfeits.

A months-long congressional probe found at least 1,800 cases of counterfeit electronics in U.S. weapons, with the total number of suspect parts exceeding 1 million.

The results of the investigation, conducted by the Senate Armed Services Committee, are to be presented at a hearing Tuesday, where senators plan to grill defense contractors about lapses in monitoring their parts supply chain.

“We cannot allow our national security to depend on electronic scrap salvaged from trash heaps by Chinese counterfeiters,” said committee Chairman Carl Levin (D-Mich.). He called the report’s findings — based on records from 10 defense contractors and their testers — “just the tip of the iceberg.” Read the rest of this entry »

Posted in Business, China, Counterfeit, Economy, Made in China, military, News, products, World | Comments Off on More Than 1 Million China Counterfeit Parts Found in U.S. Weapons

China accounts for 85% of fake goods seized in EU

Posted by Author on July 14, 2011

BRUSSELS — European customs intercepted one billion euros worth of counterfeit goods last year, with 85 percent of the fakes originating from China, the European Commission said Thursday.

The figures highlighted the rise of Chinese counterfeit goods, which had accounted for 64 percent of the fake articles seized in the 27-nation European Union in 2009.

China is by far the biggest exporter of such goods in a list that includes India, the source of counterfeit drugs, and Hong Kong, which supplies counterfeit memory cards, as well as Turkey and Thailand. Read the rest of this entry »

Posted in China, Counterfeit, Economy, Europe, Made in China, News, products, World | Comments Off on China accounts for 85% of fake goods seized in EU

US in huge federal crackdown on alleged luxury fakes from China

Posted by Author on August 4, 2010

AFP, Aug. 4, 2010 –

SAN FRANCISCO — US authorities announced Tuesday the biggest federal crackdown ever on West coast shopowners who allegedly sell counterfeit luxury handbags and other goods worth some 100 million dollars.

Prosecutors said they have charged operators of eight San Francisco shops with selling suspected designer fakes made in China, the US attorney for northern California and US Immigrations and Customs Enforcement (ICE) said.

The 25-count indictment is “part of the largest federal enforcement action ever taken against West Coast retailers suspected of selling counterfeit designer apparel and accessories,” they said in a statement.

“To consumers who think designer knockoffs are a harmless way to beat the system and get a great deal, ‘buyer beware,'” said ICE Director John Morton.

“Trademark infringement and intellectual property crime not only cost this country much needed jobs and business revenues, but the illegal importation of substandard products can also pose a serious threat to consumers’ health and safety,” he said.

Authorities revealed the details of the case in an indictment unsealed Monday. The indictment was filed in federal court July 22.

It charged the defendants, mostly residents of San Francisco, with conspiracy, smuggling goods into the United States, and trafficking in counterfeit goods.

“The investigation has led to the seizure of nearly 100 million dollars worth of counterfeit merchandise [based on the manufacturer’s suggested retail price (MSRP) had the products been legitimate],” a statement said.

Among the items seized were “clothing, handbags, wallets, jewelry, watches, scarves, sunglasses and shoes that were illegally imported from China,” it said.

The suspected counterfeit items purported to be luxury brands such as Dooney and Bourke, Nike, Coach and Kate Spade, Armani, Burberry, Prada and Louis Vuitton.

“Interdicting and destroying counterfeit and trademark infringing goods has long been a priority of the federal government,” US Attorney Joseph Russoniello said.

“The significant impact of trafficking in such merchandise on the American economy should be obvious.”


Posted in Business, China, clothing, Counterfeit, Economy, Law, Life, Made in China, News, products, Trade, USA, World | Comments Off on US in huge federal crackdown on alleged luxury fakes from China

EU report: 64% of fake goods are from China- a 10% increase

Posted by Author on July 22, 2010

BBC News, 22 July 2010 –

An EU report says 64% of fake or pirated goods seized in the 27-nation bloc last year came from China – a 10% increase on 2008.

Clothing was the biggest category of goods seized at 27%, while the amount of illegal CDs, DVDs and electrical goods seized showed a marked decline.

The economic downturn accounted for a fall in customs interventions.

Black market cigarettes, fake labels and counterfeit medicines were common contraband, the EU says.

There were significant quantities of contraband shampoos, toothpaste, toys, medicines or household appliances that could pose a health hazard, the European Commission report said on Thursday.

In all, customs officials intervened in more than 43,500 cases last year, seizing 118 million articles.

The commission said that in the past luxury goods were the most susceptible to intellectual property right (IPR) infringements, but “more and more items used by citizens in their daily lives are now affected”.

Cigarettes accounted for 19% of the products seized, other tobacco products 16%, labels 13% and medicines 10%.

More than 77% of all detained products were destroyed or a court case was initiated to determine the infringement.

Of the goods seized, 38% were flown into the EU and 34% entered the EU by post.

The main origin of contraband food and drink was Turkey, while for medicines it was the United Arab Emirates and for toys and games it was Egypt.

BBC News

Posted in Business, China, Counterfeit, Economy, Europe, Made in China, medicine, News, products, Social, Trade, World | Comments Off on EU report: 64% of fake goods are from China- a 10% increase

Italy police raid warehouses with 500,000 tonnes of fake brand name goods made in China

Posted by Author on February 15, 2010

Reuters, Feb. 13, 2010-

ROME (Reuters) – A police raid on a sprawling complex of warehouses in Rome turned up about 500,000 tonnes of Chinese goods including fakes of some of the world’s most famous designer labels, Italian police said on Saturday.

The operation, carried out in the past few days and announced on Saturday, was one of the biggest of its kind in Italy, they said.

The merchandise, which included fakes of big name brands, boxes with designer logos, and toys that did not meet European safety standards, was worth at least 5 million euros.

About 70 police agents took part in the raid on the southern outskirts of the city and found some 37 Chinese citizens, some of whom acted as lookouts, on the premises of the complex of eight warehouses.

“Inside we found an amazing number of boxes of name brand goods subdivided by type. All that was missing were the labels which had yet to be put on,” said police official Maurizio Improta.

Television footage provided by police showed fakes or empty boxes with logos of brands such as Salvatore Ferragamo, Calvin Klein, Roberto Cavalli, Armani Jeans and Puma.

“This is one of the biggest ever hauls of counterfeit goods in Italy,” Improta said.

The goods included clothing, furs and spectacles. The merchandise came from China and police said it was possible the complex of warehouses was used as a distribution point for other Italian and European cities.


Posted in Business, China, Counterfeit, Economy, Europe, Law, Made in China, News, People, products, World | 4 Comments »

Alert: Counterfeit condoms spread out in China and sold in USA

Posted by Author on January 30, 2010

By John M. Glionna, the Los Angeles Times, January 21, 2010-

Reporting from Beijing
– Sex shop owner Wang Yunsu wondered how so many competitors could suddenly undercut her low prophylactic prices.

Now she thinks she knows: The other condoms are counterfeit.

“Some manufacturers are cutting corners,” she said, stocking a shelf with a domestic brand whose name translates as Forever Love. “And it’s all about profit.”

It’s China’s latest knockoff scandal — inferior contraceptives that health officials say provide little protection and may in fact spread infectious diseases, tarnishing the axiom that condoms mean safe sex.

In November, investigators in Hunan province provided details about a July raid on an underground workshop where they found laborers lubricating condoms with vegetable oil in unsterile conditions, passing off the counterfeits as high-quality-brand products.

It wasn’t the first such bust. Police in 2008 raided an illicit factory in Zhejiang province, seizing half a million knockoff condoms.

In another case, workers recycled used condoms into hair bands in southern China.

“People could be infected with AIDS, [genital] warts or other diseases if they hold the rubber bands or strings in their mouths while weaving their hair into plaits or buns,” a dermatologist told the state-run China Daily newspaper.

The practice poses yet another disease threat in the world’s most-populous nation, where more than 2 billion condoms are used each year, supporting an estimated $530-million industry.

China mass-produces countless fake brand-name consumer goods, from shoes and handbags to DVDs and iPods, even beer. But after tainted milk killed six Chinese children and sickened about 300,000 in 2008, the spread of counterfeit condoms further demonstrates that unscrupulous manufacturers will stop at nothing to turn a profit.

Authorities estimate that up to a third of the contraceptives used in some parts of China are counterfeits, despite improvements in state food and drug oversight. None of the counterfeits are properly sterilized, and others are of such inferior quality that they could rupture during use. Authorities say they’re all dangerous.

“The quality of the knockoff condoms cannot be guaranteed, and they can easily break,” said Cheng Feng, director of the group Family Health International, China. “Such condoms definitely cannot play the role of contraception and disease prevention.”

But counterfeit condoms aren’t being sold only in China.

In 2008, officials in the New York area confiscated knockoff Chinese-made goods, including millions of phony Trojan-brand condoms that were sold in small discount stores in New York, Texas and Virginia……(more details from the Los Angeles Times)

Posted in Business, China, Counterfeit, Economy, Health, Hunan, Life, Made in China, News, products, South China, Trade, World | Comments Off on Alert: Counterfeit condoms spread out in China and sold in USA

China consumers take aim at fakes– anti-fake website

Posted by Author on November 27, 2008

by Ophelia Lui,, Via The Corporate Social Responsibility (CSR) Asia, Hong Kong, Nov. 26, 2008-

Everybody knows about the fake Gucci or Louis Vuitton handbags and purses available in China. However, you may be surprised – and terrified – as you scroll down the webpage of the Chinese bulletin board and learn about the evolving scope of fake and forged products currently available on the Chinese market. Fake products range from well-known apparel to snacks and drinks to cosmetics and mobile phones, regardless of whether they are western or local Chinese brands.

This story is not just about fakes; it is also about the growing involvement of various stakeholders in response to the emergence of such products, as noted in the establishment of the online platform that seeks to educate consumers on how to differentiate real products from fake and forged ones. is said to be China’s first, and probably the largest, website specialising in distinguishing fake and forged products. The word ligui (李鬼) is in fact a colloquial term referring to a product whose packaging is intentionally made to resemble that of a big brand, thus misleading consumers into buying the forged good. The “trick” of ligui products usually involves a slightly altered brand name for which the Chinese characters look almost identical to those in famous brands. Here are several examples from the website that demonstrate the technique:

Example below is 雪碧, Sprite versus 雲碧, its forged product:

雪碧, Sprite versus 雲碧, its forged product (from CSR Asia)

雪碧, Sprite versus 雲碧, its forged product (from CSR Asia)

可口可樂 Coca Cola versus its forged product 可日可樂:

Coca Cola versus its forged product 可日可樂 (from CSR Asia)

Coca Cola versus its forged product 可日可樂 (from CSR Asia)

Long before the tainted milk scandal broke out, forged milk products were already well established. Here the well-known Yili 伊利brand (on top) has a copycat 伊俐, pronounced exactly the same (below):

Yili 伊利brand (on top) has a copycat 伊俐, pronounced exactly the same (below) (from CSR Asia)

Yili 伊利brand (on top) has a copycat 伊俐, pronounced exactly the same (below) (from CSR Asia)

More details from CSR Asia

Posted in China, Counterfeit, Economy, Food, Law, Life, Made in China, News, products, website, World | 2 Comments »

Tainted and Fake Medicine Made In China A Big Safety Concern, FDA Unable to Fully Inspect

Posted by Author on November 9, 2008

By GARDINER HARRIS, New York Times, USA, October 31, 2008-

In the belly of an industrial district south of Lyon, France, just past a sulfurous oil refinery and a synthetic vanilla plant, sits a run-down, eight-story factory that makes aspirin, the first pharmaceutical blockbuster. The Lyon factory is the last of its kind. No other major facility in Europe or the United States makes generic aspirin anymore. The market has been taken over by low-cost Chinese producers. Even Bayer, the German company that created aspirin in the 1890s and has fought for more than a century to distinguish its product as the most trustworthy one, now has backup supplies from China.

The Lyon plant is owned by a French chemical giant named Rhodia that has been making aspirin since 1908 and still accounts for more than 25 percent of the world’s aspirin market. But now a century after its entry into the business, the company intends to quit making aspirin altogether. The plant was last renovated in 1992, and it would need an upgrade to continue operating, an investment the company can no longer justify in what has become a cutthroat business. In fact, Rhodia is closing another factory about 40 miles to the south. This one makes the painkiller acetaminophen, which is found in Tylenol. It, too, is the last such facility in Western Europe.

In some ways, this is a nonevent. European factories close; Chinese ones open. Consumers like their commodities cheap, in the case of aspirin as with everything else. China now produces about two-thirds of all aspirin and is poised to become the world’s sole global supplier in the not-too-distant future.

But are the Chinese factories safe? Who knows? The U.S. Food and Drug Administration, the European Medicines Agency and other competent government regulators rarely, if ever, inspect them. (By contrast, Rhodia’s plant was last inspected by the F.D.A. in July and is routinely inspected by one country or another.) Companies that import Chinese pharmaceutical ingredients, including aspirin, are required to test the supplies before using them, and some send private inspectors to China to ensure that suppliers use adequate controls. No pharmaceutical maker wants its name to become synonymous with disaster, and the vast majority of drugs that are consumed in the United States are safe. But some industry executives told me that price sensitivity in the generics industry makes it more difficult to fully vet their low-cost suppliers.

In China, where thousands of drug manufacturers sell products in the local markets, profit margins are razor thin, and counterfeiting and contamination are common. In 2002, the Pharmaceutical Association, a Chinese trade group, estimated that as much as 8 percent of over-the-counter drugs sold in China are counterfeit. Contaminated products extend beyond drugs, as was made tragically clear this fall when four Chinese babies died and 53,000 were sickened by melamine, a toxic chemical illegally added to watered-down baby formula to artificially increase the protein count and fool quality tests.

Though no melamine-tainted baby formula from China was found in the United States, it has shown up in other countries. This is the latest in a series of food- and drug-safety scandals. China has in recent years exported poisonous toothpaste, deadly dog food, toys made with lead paint and tainted fish. In one infamous example this spring, Chinese manufacturers substituted a cheap fake for the dried pig intestines used to make the drug heparin, which is given to dialysis and surgery patients to prevent blood clotting. As deaths among those taking the drug mounted, the F.D.A. discovered the taint and banned the contaminated drug. In the end, 81 people may have died from allergic reactions, and tens of thousands around the world were exposed to danger. F.D.A. officials admitted that the agency should never have approved the Chinese-made heparin for sale in the United States; the agency, it turned out, had never inspected the Chinese plant making it.

Concerns about Chinese drugs have become so intense that just three weeks ago, the Health and Human Services secretary, Michael O. Leavitt, announced that the F.D.A. would open an office in Beijing by the end of the year and offices in Shanghai and Guangzhou next year. The agency still plans to send inspectors to China from the U.S., but the offices will provide “an infrastructure that will make those people more effective,” Leavitt said at the time of the announcement.

China’s leap to one of the biggest suppliers of pharmaceutical ingredients in the world happened over the last decade, as the Chinese government subsidized the construction of manufacturing plants that have undercut prices everywhere. Generic drug makers in the United States, where price competition is fierce, were the first to seek cheaper drug ingredients in China. Last year, generic drug applications to the F.D.A. listed 1,154 plants providing active pharmaceutical ingredients: 43 percent of them were in China, and another 39 percent were in India. Only 13 percent were in the United States. Branded drug makers, with their fatter profit margins, resisted buying ingredients from China for years, but with their businesses now suffering, even major pharmaceutical companies like AstraZeneca, Bayer, Baxter and Pfizer have announced deals to outsource manufacturing to China.

I have been writing about the drug industry for more than a decade, but I have rarely written about a subject that both branded and generic drug makers wanted to discuss less. Nearly all of the industry executives who spoke for this article did so anonymously. Even the Generic Pharmaceutical Association, a normally loquacious trade group, was largely silent on the issue. Not one of them, it seems, wants to talk too much about the difficulty of regulating factories across several times zones, 6,000 miles and a vast linguistic and cultural divide.

The F.D.A. regulates more than $1 trillion worth of consumer goods, which amounts to about 25 cents of every consumer dollar spent in this country. This includes $466 billion in food sales, $275 billion in drugs, $60 billion in cosmetics and $18 billion in vitamin supplements. The agency is responsible for monitoring a third of all imported goods, from eggplant to eyeliner, microwave ovens to monoclonal antibodies, slaughterhouses to cellphones. But with fewer than 500 import inspectors and computer systems so old that repairmen must be called out of retirement to fix them, the agency is increasingly beset by a sense of futility.

Even the F.D.A.’s staunchest defenders now acknowledge that something is terribly wrong. Among them is Peter Barton Hutt, who served as the agency’s general counsel during the Nixon administration and is widely considered the dean of the F.D.A. bar in Washington. I’ve interviewed Hutt dozens of times over the years, and he has always defended the F.D.A. No more. “This is a fundamentally broken agency,” Hutt told me earlier this year, “and it needs to be repaired.”

The breakdown is not simply about money. This summer 1,442 people around the country were sickened by tainted tomatoes — or possibly jalepeño peppers. Such scares have become familiar, and the inability to quickly find the sources of contamination has been one of the agency’s signal failures. A 2002 law requires produce processors and distributors to keep track of where food goes and comes from, but the government has yet to mandate standardized record-keeping. As a result, in response to a scare, investigators must pour over a blizzard of contradictory packing slips and incompatible computer programs as they race to save people.

To ensure the safety of imported drugs, the F.D.A. relies almost entirely on its own inspections of foreign plants. This was not much of a problem 30 years ago, when most medical products consumed in the United States were made here and F.D.A. inspectors could drive around to plants in their district. Most of those plants have since moved abroad, and now decades can pass between inspections. Testifying before Congress in April, Dr. Janet Woodcock, director of the F.D.A.’s drug center, spoke with rare frankness about the ability of the agency to do its job abroad. “The F.D.A. of the last century is not configured to regulate this century’s globalized pharmaceutical industry,” she testified.

Other current and former F.D.A. officials I talked to echoed Woodcock’s warning. Tim Wells, who was a field investigator and then a compliance officer for 24 years at the F.D.A., now does private audits of drug plants and sees the holes in the agency’s safety net. “A company I recently visited abroad hasn’t been inspected for 10 years,” he told me.

Besides being more frequent, domestic inspections are unannounced and more intense. And when inspectors find dangerous conditions at domestic plants, they generally return promptly to ensure that those conditions get fixed. Not so in foreign plants. In a report released Oct. 22, government auditors reported that between 2002 and 2007, F.D.A. inspectors found dangerous conditions in 15 foreign plants. Only one of those plants was reinspected within two years, the auditors found. In every other case, the agency took foreign managers at their word that promised changes were made.

The record is particularly bad in China. Over the past six years, the F.D.A. has managed to inspect annually an average of just 15 of the 714 Chinese drug plants that export to the United States. At its present pace, the F.D.A. would need more than 50 years to visit all of these Chinese plants. By contrast, the F.D.A. inspects domestic drug plants every 2.7 years.

Inspectors volunteer for the grueling overseas assignments, and, it turns out, they don’t much like traveling to parts of Asia. “I went to Taiwan once, and after initially spending a night in a very nice hotel, I was transferred several hours by car to a hotel closer to the plant,” recalls DeVaughn Edwards, who worked as an F.D.A. inspector for 14 years until he left in 2006. “The bed consisted of two mattresses on the floor. There was no lock on the door. You had to hope that no one came in. It was dark; there were no amenities, no TV that worked. There was a shared restroom down the hall. It was only one night there, but it was enough to make you not want to revisit the plant or spend too much time there.”

When inspectors do go to China, their reports sometimes read like a bureaucratic rendering of Mark Twain’s “Innocents Abroad.” During a 2001 trip, for example, two F.D.A. inspectors visited a plant that was exporting acetaminophen to the United States. The plant had never been inspected. “The F.D.A. inspection team was met at the hotel in Wenzhou by representatives from Wenzhou No. 3 Pharmaceutical Factory and . . . transported by public ferry and then company vehicle to the manufacturing facility on Dong Tou Island off the coast of Wenzhou,” their report states. “There is no street address or plot number, and the address of the facility is given only by the county and province.”

Once the team arrived in what seemed like the middle of nowhere, the inspectors learned the drug was being manufactured at another plant — one that once had a similar name but had recently changed it. “In fact,” the report continues, “inspection found that there were initially three separate and independent firms operating under the names Wenzhou No. 1 Pharmaceutical Factory, Wenzhou No. 2 Pharmaceutical Factory and Wenzhou No. 3 Pharmaceutical Factory. The location of Wenzhou No. 1 Pharmaceutical Factory was also determined by the F.D.A. inspection team during the visit to Wenzhou, and it was learned that the firm is operating under a new Chinese name; however, the English translation of that name was not available.” So the two inspectors flew back to the

United States — at taxpayers’ expense — never having inspected a thing.

The F.D.A.’s apparent inability to keep names straight is no trivial matter. One reason the agency failed to inspect the Changzhou plant that produced deadly heparin, for instance, was that someone mixed up the facility’s name and concluded that the plant had already been inspected. Chinese plant names, a vestige of its once strictly controlled economy, are often very similar, and translations can vary. For instance, there are 57 separate drug master files — the basic F.D.A. record of a plant’s name, location and approved product — with “Shanghai” in the name. Some are obvious repeats, like the ones for “Shanghai No. 6 Pharmaceutical Factory” and “Shanghai Number 6 Pharmaceutical Factory.” But others could be separate plants. Or maybe not. It’s just too hard to tell.

Compounding the problem is the F.D.A.’s antiquated technology. Its computer systems are so awful that officials have no way of knowing which names, or which plants, are real. To determine which factories need to be inspected, agency investigators must consult two incompatible databases, one of which lists 3,000 foreign drug plants exporting to the United States and the other 6,800. Which number is right? Nobody really knows. Officials have told House investigators that their best guess for the number of foreign drug plants exporting to the United States is 2,967, while the Government Accountability Office recently guessed 3,249. Neither can the agency tell in many cases when the plants were last inspected (or, more important, which have never been inspected), where they are located or what products they make……. (more details from The NewYork Times: The Safety Gap)

Alarming: Tainted Food = Terrorism ?

Posted in Asia, Business, China, Company, Counterfeit, Economy, Food, Health, Law, Life, Made in China, medical, medicine, News, People, products, Social, Tainted Products, USA, World | 1 Comment »

Dangerous Fakes: Used on U.S. Warplanes and Ships, From China

Posted by Author on October 6, 2008

by Brian Grow, Chi-Chu Tschang, Cliff Edwards and Brian Burnsed, The Business Week, October 2, 2008-

The American military faces a growing threat of potentially fatal equipment failure—and even foreign espionage—because of counterfeit computer components used in warplanes, ships, and communication networks. Fake microchips flow from unruly bazaars in rural China to dubious kitchen-table brokers in the U.S. and into complex weapons. Senior Pentagon officials publicly play down the danger, but government documents, as well as interviews with insiders, suggest possible connections between phony parts and breakdowns.

In November 2005, a confidential Pentagon-industry program that tracks counterfeits issued an alert that “BAE Systems experienced field failures,” meaning military equipment malfunctions, which the large defense contractor traced to

fake microchips. Chips are the tiny electronic circuits found in computers and other gear.

The alert from the Government-Industry Data Exchange Program (GIDEP), reviewed by BusinessWeek (MHP), said two batches of chips “were never shipped” by their supposed manufacturer, Maxim Integrated Products in Sunnyvale, Calif. “Maxim considers these parts to be counterfeit,” the alert states. (In response to BusinessWeek’s questions, BAE said the alert had referred erroneously to field failures. The company denied there were any malfunctions.)

In a separate incident last January, a chip falsely identified as having been made by Xicor, now a unit of Intersil in Milpitas, Calif., was discovered in the flight computer of an F-15 fighter jet at Robins Air Force Base in Warner Robins, Ga. People familiar with the situation say technicians were repairing the F-15 at the time. Special Agent Terry Mosher of the Air Force Office of Special Investigations confirms that the 409th Supply Chain Management Squadron eventually found four counterfeit Xicor chips.

Potentially more alarming than either of the two aircraft episodes are hundreds of counterfeit routers made in China and sold to the Army, Navy, Air Force, and Marines over the past four years. These fakes could facilitate foreign espionage, as well as cause accidents. The U.S. Justice Dept. is prosecuting the operators of an electronics distributor in Texas—and last year obtained guilty pleas from the proprietors of a company in Washington State—for allegedly selling the military dozens of falsely labeled routers, devices that direct data through digital networks. The routers were marked as having been made by the San Jose technology giant Cisco Systems (CSCO).

Referring to the seizure of more than 400 fake routers so far, Melissa E. Hathaway, head of cyber security in the Office of the Director of National Intelligence, says: “Counterfeit products have been linked to the crash of mission-critical networks, and may also contain hidden ‘back doors’ enabling network security to be bypassed and sensitive data accessed [by hackers, thieves, and spies].” She declines to elaborate. In a 50-page presentation for industry audiences, the FBI concurs that the routers could allow Chinese operatives to “gain access to otherwise secure systems” (page 38).

It’s very difficult to determine whether tiny fake parts have contributed to particular plane crashes or missile mishaps, says Robert P. Ernst, who heads research into counterfeit parts for the Naval Air Systems Command’s Aging Aircraft Program in Patuxent River, Md. Ernst estimates that as many as 15% of all the spare and replacement microchips the Pentagon buys are counterfeit. As a result, he says, “we are having field failures regularly within our weapon systems—and in almost every weapon system.” He declines to provide details but says that, in his opinion, fake parts almost certainly have contributed to serious accidents. When a helicopter goes down in Iraq or Afghanistan, he explains, “we don’t always do the root-cause investigation of every component failure.”

While anxiety about fake computer components has begun to spread within the Pentagon, top officials have been slow to respond, says Ernst, 48, a civilian engineer for the military for the past 26 years. “I am very frustrated with the leadership’s inability to react to this issue.” Retired four-star General William G.T. Tuttle Jr., former chief of the Army Materiel Command and now a defense industry consultant, agrees: “What we have is a pollution of the military supply chain.”

Much of that pollution emanates from the Chinese hinterlands. BusinessWeek tracked counterfeit military components used in gear made by BAE Systems to traders in Shenzhen, China. The traders typically obtain supplies from recycled-chip emporiums such as the Guiyu Electronics Market outside the city of Shantou in southeastern China. The garbage-strewn streets of Guiyu reek of burning plastic as workers in back rooms and open yards strip chips from old PC circuit boards. The components, typically less than an inch long, are cleaned in the nearby Lianjiang River and then sold from the cramped premises of businesses such as Jinlong Electronics Trade Center. …… (more details from

Posted in China, Counterfeit, Economy, Made in China, military, News, Politics, products, Technology, USA, World | Comments Off on Dangerous Fakes: Used on U.S. Warplanes and Ships, From China

China Counterfeiters Going High-Tech: Cisco routers, switches

Posted by Author on September 23, 2008

By Heide B. Malhotra, Epoch Times Staff Sep 21, 2008-

WASHINGTON—Seizures by U.S. and Canadian customs agencies revealed that Chinese counterfeit goods have surpassed just luxury items and DVDs. Recent seizures uncovered 74,000 counterfeit Cisco Systems, Inc. high-tech products from China, worth more than $76 million.

Counterfeit Cisco routers, switches, interface cards and other networking hardware could put U.S. companies at risk of infiltration by hackers and criminals, as well as network malfunction. The equipment had been shipped from Shenzhen City, Guangdong Province in Southern China.

“Counterfeit network hardware entering the marketplace raises significant public safety concerns and must be stopped,” said Alice S. Fisher, Assistant U.S. Attorney General in a recent U.S. Attorney’s Office press release.

The investigation into counterfeit goods—codenamed “Operation Cisco Raider”—is a cooperative effort between The U.S. immigration and Customs Enforcement (ICE), U.S. Customs and Border Protection (CBP), the Royal Canadian Mounted Police (RCMP), U.S. Federal Bureau of Investigation (FBI) and the U.S. Attorney’s Offices.

The operation resulted in 36 search warrants. The Justice Department announced ten guilty verdicts and fines totaling $1.7 million.

Earlier this year, the FBI’s Cyber Division handed out a newly unclassified PowerPoint presentation rooting out counterfeit computer and network components. The presentation has since been posted on the Internet by tech blogs.

Secret Information

In April, University of Illinois Professor Samuel King claimed that counterfeit computer and network parts might be sold by China to gain access to sensitive U.S. military data.

Tech blogs suggest that the FBI and the Department of Defense are worried about such components being placed into their computer and network systems.

A press release from the U.S. Attorney’s Office in the Eastern District of Virginia stressed that Cisco “has cooperated with U.S. and Canadian law enforcement authorities and provided exceptional assistance throughout these investigations.”

U.S. and Europe Joining Forces

More than 360,000 counterfeit Cisco, Siemens AG, Royal Philips Electronics N.V. and Intel Corp.-branded computer and networking components—worth around $1.3 billion—were confiscated during 2007, according to a recent joint U.S. and European Union law enforcement press release.

“In terms of overall quantities seized, China remains the main source for counterfeit goods, with almost 60 percent of all articles seized coming from there,” according to a European Commission press release last month.

In Europe, counterfeit computer equipment seizures increased by 62 percent in 2007 over the prior year.

Cisco Under Scrutiny

Cisco Systems Inc.’s cozy business relationship with China has been well documented, including its role in supporting China’s Internet self-censorship, widely known around the world as the “Great Firewall.”

“Cisco did a favor to the Chinese government several years ago by selling them the mirroring routers on which the Great Firewall is based, at a time when Chinese authorities could not easily have produced the systems on their own,” said James Fallows from “The Atlantic Monthly” during an interview with Network World Inc.

“The likely use of the routers was well understood—and it should be obvious why selling them to a government which intends to monitor its citizens is different from selling them to some company that wants to monitor its employees,” Fallows continued.

Cisco officials have testified during U.S. Senate and other hearings, insisting that it makes “off-the-shelf products” and does not specifically modify them to suit any country. Cisco will not sell products to any country that the U.S. federal government prohibits doing business with. Its only interest is to make the Internet accessible to anyone in the world, Cisco claims.

However, leaked internal documents from China suggest that Cisco was aware of China’s intentions and enthusiastically provided such technology to a repressive regime. The document even makes special mention of its role in silencing Falun Gong and other dissidents.

Rep. Chris Smith (R-NJ) is the author of the Global Online Freedom Act (HR 275), to be voted on before the 2008 Olympics. If it becomes law, the Act will prohibit U.S. companies—such as Yahoo! and Google—from cooperating with repressive regimes. The act is supported by human rights organizations, media advocate Reporters without Borders, the Center for Democracy Technology among other interest groups.

“American high-tech firms have produced the technology and know-how that has led to a modern-day information revolution. Sadly, however, instead of working to allow everyone to benefit from these advancements, these same high-tech firms are colluding with dictators and tyrannical regimes such as China to suppress human rights information and punish pro-democracy advocates,” said Smith in a recent release.

– Original: The Epochtimes

Posted in censorship, China, Company, Counterfeit, Economy, Human Rights, Internet, Law, News, Politics, products, Social, Speech, Technology, USA, World | 1 Comment »

3,500 China Made Counterfeit Network Devices Sold to U.S. Government, FBI Investigating

Posted by Author on May 12, 2008

By PIERRE THOMAS and JASON RYAN, ABC News, USA, May 9, 2008 –

The FBI is investigating whether counterfeit routers and computer hardware from China installed in U.S. government computer networks might provide a secret gateway for hackers to tap into secure government databases.

Sources told ABC News the counterfeit hardware could represent a major breach to national security. An FBI PowerPoint presentation, which somehow ended up on a Web site, lays out the concerns and the breadth of what has been a far-reaching investigation.

Friday afternoon a somewhat miffed FBI released a statement that read: “At the request of another federal government agency, on Jan. 11, 2008, the FBI’s Cyber Division provided an unclassified PowerPoint presentation and briefing on efforts to counter the production and distribution of counterfeit network hardware,” said FBI Cyber Division Assistant Director James Finch. “This unclassified briefing was never intended for broad distribution or posting to the Internet.”

Finch goes on to talk about Operation Cisco Raider, which “targeted illegal distributors of counterfeit network hardware manufactured in China and included 15 investigations across nine FBI field offices and the execution of 39 search warrants.”

According to Finch, the FBI “disrupted a large distribution network and recovered approximately 3,500 counterfeit network components with an estimated retail value of over $3.5 million.”

In total, authorities around the world, including in the United States, Canada and China, made more than 400 seizures with an estimated value of $76 million. In one instance, the Royal Canadian Mounted Police seized 1,600 pieces of counterfeit Cisco routers.

In other words, government officials, defense contractors and universities thought they were getting top-notch products from Cisco, a well-regarded American company. Instead, they were buying counterfeit equipment that originated in China, which traveled a circuitous route to its final destination.

Those phony Chinese routers, switches, converters and interface cards were sold to the U.S. Naval Academy, U.S. Naval Air Warfare Center, U.S. Naval Undersea Warfare Center, the General Services Administration, the U.S. air base in Spangdahlem, Germany — which is home to the Air Force’s 52nd Fighter Wing — and defense contractor Raytheon.

Some parts ended up in networks serving the Marine Corps, Air Force, Federal Aviation Administration and the FBI.

The cheap, lower-quality equipment led to some system failures and other problems. The real concern, though, is whether this computer hardware represents some sort of Trojan horse that can be manipulated by hackers to steal sensitive information.

Cisco spokesman John Noh told ABC News via e-mail that the company has extensively tested counterfeit equipment purporting to be made by the company, and though not “technically inconceivable,” the company’s tests “have not found a single instance of software or hardware that was modified to make them more vulnerable to security threats.”

Noh acknowledged that counterfeiting of computer technology is “an industrywide issue,” but that Cisco has an internal team dedicated to preventing damage from counterfeiting and that the company works with law enforcement in its investigations.

According to the FBI PowerPoint, Cisco controls 80 percent of the computer router technology market.

The FBI and a number of government agencies are now examining the hardware trying to determine if there has been a massive security breach.

The People’s Republic of China has not been accused of orchestrating the counterfeit sales, but for several years, U.S. officials have been investigating a wave of government computer breaches thought to have originated in China.

Cisco has been working with U.S. investigators and representatives from China’s Technical Service and Public Security bureaus since 2003 to combat the counterfeiting of its routers.

– Original from ABC News: Counterfeit Chinese Technology: Gateway for Hackers?

Posted in Business, China, Company, Computer, Counterfeit, Economy, Internet, Law, Made in China, military, News, Politics, products, Technology, USA, World | 1 Comment »

Italian Police Seized 200,000 China-made Fake Watches and 30,000 Luxury Pens

Posted by Author on February 27, 2008

The Times, UK, Feb. 27, 2008-

ROME Italian police have seized 200,000 Chinese-made fake watches and 30,000 luxury pens said to be practically identical to the originals. The haul, worth about £3 million, is one of the biggest. Five Chinese nationals in Rome face charges. (AFP)

– Original report from The times: Fake watch haul

Posted in Business, China, Counterfeit, Economy, Law, Made in China, News, products, World | Comments Off on Italian Police Seized 200,000 China-made Fake Watches and 30,000 Luxury Pens

30,000 China-made Remote-Controlled Helicopter Toys Recalled, Due to Fire and Burn Hazards

Posted by Author on February 13, 2008

Press release, U.S. Consumer Product Safety Commission, Feb. 12, 2008-

WASHINGTON, D.C. – The U.S. Consumer Product Safety Commission, in cooperation with the firm named below, today announced a voluntary recall of the following consumer product. Consumers should stop using recalled products immediately unless otherwise instructed.

Name of Product: Remote-Controlled Helicopter Toys

About 30,000

Importer: Soft Air USA Inc., of Grapevine, Texas

The rechargeable battery contained inside the helicopter can catch fire during charging, igniting the helicopter and nearby combustible materials. This poses a burn or fire hazard to consumers.

Incidents/Injuries: Soft Air USA has received six reports of helicopters igniting, including one minor injury.

Description: This recall involves the remote-controlled helicopter toy “Fun2Fly Microcopter” with item number 91001. The helicopter comes with a transmitter that controls and recharges the helicopter. The helicopter is made of foam and plastic and measures about 6 ½ inches by 2 ½ inches. The transmitter measures about 4 1/2 inches by 5 inches. “Fun2Fly” and “Microcopter” are printed on the packaging. The item number is printed above the UPC label.

Sold at: Sporting goods stores and other retailers nationwide from May 2007 through December 2007 for about $30.

Manufactured in: China

Remedy: Consumers should immediately stop using the recalled toy helicopter and return it to the retailer where it was purchased for a full refund.

Consumer Contact
: For additional information, call Soft Air USA collect at (817) 210-4181 between 8:30 a.m. and 5 p.m. CT Monday through Friday, or e-mail the company at

Original press release from U.S. Consumer Product Safety Commission

Posted in Business, China, Counterfeit, Economy, Made in China, News, products, Toy, USA, World | 1 Comment »

China Market for Fakes in Beijing Launches Own Brand

Posted by Author on January 25, 2008

Reuters, Thu 24 Jan 2008-

BEIJING (Reuters) – Beijing’s Silk Street Market, famous for knock-off designer gear from North Face jackets to Louis Vuitton bags, has unveiled its own brand and, apparently with a straight face, warned counterfeiters not to copy it.

The first items to bear the SILKSTREET name include “apparel such as neckties, shirts and scarves, as well as a few household items such as tablecloths”, Xinhua news agency said on Thursday.

They are marked “quality guaranteed” with a label that tells buyers that “the goods are certified by the Silk Street Market.

“SILKSTREET products are sold exclusively in the market. Anyone using the brand outside will be held liable,” the Beijing Evening News quoted Wang Zili, general manager of the market, as saying.

The market, a magnet for both local expatriates and foreign tourists, said as early as January 2005 that it would stop the sale of counterfeit goods but they have been on sale openly ever since.

That announcement came a day ahead of a visit by then U.S. Commerce Secretary Don Evans for an intellectual property rights forum and amid Chinese pledges to get tough on copyright violations.

Original report from Reuters

Posted in Beijing, Business, China, Copyrights, Counterfeit, Economy, Law, Life, Made in China, News, products, World | Comments Off on China Market for Fakes in Beijing Launches Own Brand

China: 100,000 pairs of used chopsticks sold without disinfection every day

Posted by Author on August 22, 2007

Reuters, Wed Aug 22, 2007-

BEIJING (Reuters) – A Beijing factory recycled used chopsticks and sold up to 100,000 pairs a day without any form of disinfection, a newspaper said on Wednesday, the latest is a string of food and product safety scares.

Counterfeit, shoddy and dangerous products are widespread in China, whose exports have been rocked in recent months by a spate of safety scandals, ranging from pet food to medicine, tires, toothpaste and toys.

Officials raided the factory and seized about half a million pairs of recycled disposable bamboo chopsticks and a packaging machine, the Beijing News said.

The owner, identified only by his surname Wu, said he had sold the recycled chopsticks for 0.04 yuan a pair and made an average of about 1,000 yuan ($130) a day.

Wu, who had no license to sell the goods, said he had sold 100,000 pairs a day when business was good.

China, on track to overtake the United States this year as the world’s second-largest exporter, lacks a basic food safety law and the manpower to enforce food and drug safety regulations at home or for export. Imports are generally carefully scrutinized.

A lack of business ethics and a spiritual vacuum after China embraced economic reforms in the late 1970s have been blamed for unscrupulous business practices and corruption.

In Guangzhou, capital of booming Guangdong province in south China, Mayor Zhang Guangning vowed to bankrupt serious violators of food and product safety.

The Hong Kong owner of a Guangdong manufacturer at the centre of a recall of Chinese-made toys by U.S. giant Mattel had committed suicide, according to Hong Kong media.

In the latest in a series of tit-for-tat measures, China has accused the United States of exporting substandard soybean shipments to China and requested “effective measures” be taken.

– Original report from Reuters : Now dirty chopsticks picked up in China scare

Posted in Beijing, Business, Businessman, China, corruption, Counterfeit, Economy, Health, Law, Life, Made in China, News, People, products, Social, Tainted Products, World | 3 Comments »

China: Trial of Pharmaceutical Company Exposes Counterfeit Medicine Production

Posted by Author on August 22, 2007

The Epoch Times, Aug 21, 2007-

On August 8 2007, Guangzhou City Intermediate People’s Court held criminal proceedings of a well-known counterfeit medicine manufacturing case. Five people from Qiqihar No.2 Pharmaceutical Co., Ltd, were criminally charged with, “causing a major liability accident.”

The well-known pharmaceutical manufacturer Qiqihar No.2 Pharmaceutical Co., Ltd. held a national GMP (Good Manufacturing Practice; drug production quality control standard) certification. Its pharmaceuticals were sold all over the country.

The five people on trial included one general manager, two deputy general managers, one laboratory director and one purchaser. The people concerned control the company’s purchasing, quality control, sales and production.

According to a Chinese report on, dated August 9, once in court the five defendants exposed a lot of inside information detailing counterfeit medicine production:

1. Purchasing Division – “Cannot Understand Quality Control Report from Vendor”

Mr. Niu Zhongren, the only individual responsible for purchasing raw materials, was only a junior high school graduate. He cited being “unbearably busy,” and replaced the mandatory “field inspections” and “sample testing” with simple “phone calls” in the purchasing process. Mr. Niu believed that drug production quality control was a matter for the Quality Control Division, so it did not fall within his scope of responsibilities. He also claimed that he “could not understand the quality control reports from vendors.”

2. Approval Link – “GMP Certification Was Bought”

Mr. Guo Xingping was the deputy-general manager of the company. He was in charge of purchases, storage and distribution. The prosecution questioned him about why GMP certification requirements were not met. He was asked why in the absence of field investigations and sample testing was the company allowed to purchase drug supplies.

Answering the question, Mr. Xingping used an analogy, “This is like buying pork. If you go to buy two catties of pork (one catty equals 1.1 pounds) but you suspect that the pork contains clenobuterol hydrochloride (a banned substance). Would you go to a pig farm to do the field investigation?”

As for the GMP certificate, Mr. Guo claimed that the certification, that was supposed to be approved by the regulating body, the Provincial Medicine Regulation Department and registered in the National Medicine Regulation Department, was purchased by the company. “It is just a disc that contains all the documents. The company bought it for 100,000 yuan (USD$13,150)! It is completely impractical for operating in real life” said Mr. Guo.

3. Laboratory Testing Stage

“Of the eleven laboratory technicians, there are only a few who actually have the relevant industry knowledge. Most people are not trained” Ms Chen Guifen was the Laboratory Director of the company.

When she tested a batch of “propylene glycol,” she found the relative density of the batch was not acceptable. However, she did not perform more lab tests to further identify the problem. She wrote false inspection reports following the instructions of Deputy General Manager Zhu Chuahua, who was in charge of quality control.

Ms Chen said, “Of the eleven laboratory technicians, there are only a few who actually have the relevant industry knowledge. Most people are not trained. Many did not even have work permits.”

4. Production and Quality Control Division

“It is the company’s unspoken rule that if raw materials are substandard, we need to approve them (by Inspection Report)”. Deputy General Manager Zhu Chuahua was in charge of the Quality Control Division.

He knew the batch of propylene glycol was a counterfeit product, and that its relative density was not acceptable. In addition, the company’s facilities were ill equipped and the lab technicians were not technically qualified. However, he told Ms Guo to file false inspection reports.

Mr. Zhu said, “It is the company’s unspoken rule that if raw materials are substandard, we need to approve them (by way of an Inspection Report)”. He added, “This is the way it has always been done”.

5. The Final Comment

“When raw materials are first received, employees are each responsible for their specific task. I don’t necessarily know what that might be .”As the general manager of the company, Mr. Yin Jiade denied his responsibility; even though he knew most of his staff were not technically qualified. Mr. Yin said, “When raw materials are first received employees are each responsible for their specific task. I don’t necessarily know what that might be.”

According to the report, 13 people in Guangzhou have died because of the medicine and dozens of victims want to file claims for more than 20 million yuan (US$2,630,129) in damages.

Original report from the Epochtimes

Posted in Business, Businessman, China, Company, Counterfeit, Guangdong, Guangzhou, Health, Law, Life, Made in China, medical, medicine, News, People, products, SE China, Social, Tainted Products, World | 2 Comments »

Fake Diabetes Test Strips Traced to China by Johnson & Johnson

Posted by Author on August 19, 2007

By Allan Dodds Frank and Lisa Rapaport, Bloomberg, Aug. 16, 2007-

Aug. 16 (Bloomberg) — A global manhunt launched by Johnson & Johnson has tracked to China counterfeit versions of an at- home diabetes test used by 10 million Americans to take sensitive measurements of blood-sugar levels.

Potentially dangerous copies of the OneTouch Test Strip sold by J&J’s LifeScan unit surfaced in American and Canadian pharmacies last year, according to federal court documents unsealed in June. New Brunswick, New Jersey-based J&J, the world’s largest consumer-health products maker, learned of the counterfeit tests after 15 patients complained of faulty results last September…… ( more details from Bloomberg : China Counterfeit Diabetes Tests Tracked by J&J (Update1) )

Posted in Business, Canada, China, Counterfeit, Economy, Health, Law, Made in China, medical, News, products, Trade, USA, World | Comments Off on Fake Diabetes Test Strips Traced to China by Johnson & Johnson

(Photos) Man-made Fake Eggs Sold on China Night Market

Posted by Author on August 15, 2007

Zhengzhou city’s local newspaper Zhengzhou Daily (Zhengzhou is the capital city of Henan province, in Central China) reported on Aug 13, 2007 that resident Mr. Wang, who’s selling food additive for many years, found that the chicken eggs he bought on night market didn’t look nature- his experience in food told him the “eggs” were made by additive!

So he caught the boss of the restaurant and asked him to tell he the truth, otherwise he will sue to the authority. The boss then reluctantly told Ms. Wang that the eggs were totally man-made, he actually didn’t make it himself but bought from a producer, and had finally told him the process of how to make fake “eggs”.

Mr. Wang then bought some materials – chemical food additive- and exposed to the reporter how to make fake eggs.

egg yolk

Above: additive liquor, for making egg yolk

egg yolk (2)

Above: egg yolk is ready after concreting

egg white

Above: put “egg white” – also additive- on egg yolk

After put the “egg” inside a calcium carbonate eggshell, a complete egg is ready – it only take less than 5 minutes.

Why make fake eggs ?

Because of money.

The cost of fake egg is only 0.55 Yuan/kg, while the true eggs’ market price is 5.6 Yuan/kg.

Read the Chinese report of this story Via Watching China website.

Posted in Asia, Business, Businessman, Central China, China, Counterfeit, Economy, Food, Health, Henan, Law, Life, Made in China, News, People, Photo, products, World, Zhengzhou | 20 Comments »

S. Korean Minister to China Dies After Eating Sandwich

Posted by Author on August 4, 2007

The Chosun Ilbo, South Korean, July.31,2007-

Whang Joung-il, 52, a high-ranking diplomat at the Korean Embassy in China, died while being treated in a clinic in downtown Beijing Sunday morning.

On Saturday evening Whang ate a sandwich from a nearby shop while working in his office at the embassy. He then experienced diarrhea and severe abdominal pain and went home.

The next morning Whang suffered shortness of breath and died while being given an injection of Ringer’s solution at a clinic in the Chaoyang district of downtown Beijing.

According to Korean Ambassador to China Kim Ha-joong, Whang continued to suffer from stomachache and diarrhea after he returned home from his office.

Around 8:30 in the morning Whang drove his car to the clinic, which is popular with foreigners. He died about 20 minutes after he began receiving the intravenous solution.

The clinic had prescribed Ringer’s solution to prevent dehydration. Just after he began receiving the solution, he began having difficulty breathing.

The clinic dialed the emergency number 911, the equivalent to Korea’s 119, and began performing CPR. But when emergency medical responders arrived 20 minutes later, Whang had stopped breathing. The clinic confirmed his death at 11:30 a.m.

Witnessed by an embassy official, Chinese police and officials from China’s Ministry of Health seized the remaining solution for investigation.

With the consent of the embassy and Whang’s family, Chinese police performed an autopsy on his body Monday afternoon.

The exact cause of Whang’s death will likely be known after the results of the autopsy are released. Chinese authorities promised the embassy they would deliver the results as soon as possible.

The embassy believes Whang’s death may be linked to the sandwich he ate the previous evening, or to the intravenous solution. The solution may have been fake or improperly administered.

China has been plagued by serious health issues in recent days, including an uproar over steamed dumplings allegedly stuffed with chemical-laced cardboard instead of pork, and the distribution of bogus foods and medicines including phony blood for transfusions.

( Whang Joung-il, minister for political affairs at the Korean Embassy in China) 

-Original report from : Senior S.Korean Diplomat Dies in Beijing

Posted in Asia, Beijing, China, Counterfeit, Economy, Food, Health, Life, Made in China, medical, News, People, Politics, products, Social, World | 2 Comments »

China, a Haven for Fake Goods

Posted by Author on August 1, 2007

By Kim Ki-cheon, in-house columnist of Chosun Ilbo, South Korea, Aug.1,2007-

“You’ll see everything here in Shenyang is fake, except for Shenyang itself,” a South Korean executive told a Chosun Ilbo news team in Shenyang, China some time ago. He was only half joking. He showed us a designer watch that would cost millions of won in South Korea. It was a fake, of course, bought for 20 yuan (US$1=CNY7.57). So was his wallet, his belt, his shoes — all fakes. There’s no reason to pay for genuine brand name goods in China, the executive said, because even if you buy the real thing, people just assume it’s fake.

▶In China, “there is nothing that cannot be made, with the exception of man.” Fakes are overflowing the Chinese market, and many of them look fantastic.

Fake eggs recently caused a stir in Guangzhou. The white of the egg was made from industrial powder and alum, the yolk was calcium chloride. The eggshell was made from paraffin wax. If you broke the shell you could easily see that it’s fake because the white and yolk mixed together, but an unbroken one was very difficult to distinguish from a genuine egg. It was almost a work of art. But it was a little puzzling why they put so much effort into it, considering that real eggs don’t cost much.

▶In the province of Anhui in 2004, 13 babies died after they were fed with fake infant formula. Surviving babies had long lasting abnormalities, including skinny bodies and large heads, due to serious malnourishment and side effects.

Last year, nine people died at the hospital of Sun Yat-Sen University in Guangzhou after being given intravenous injections laced with diethylene glycol, used in car anti-freeze.

▶Whang Joung-il, minister for political affairs at the Korean Embassy in China, died while being treated at a clinic in downtown Beijing on Sunday.

On Saturday evening Whang ate a sandwich from a nearby shop while working in his office at the embassy. He later experienced diarrhea and severe abdominal pain. The next morning Whang rushed to the clinic, where he suffered shortness of breath and died after receiving an injection of Ringer’s solution.

Chinese police and health authorities are reportedly investigating the solution to see if it was fake.

▶He Qinglian, a Chinese university professor, was forced into exile in the U.S. after she blew the whistle on problems with the Chinese government’s opening and reform policies. China, she once said, is a “republic of con-artists.” She lamented that in her country everybody, including public servants, corporate executives, and merchants, is bent on trying to make money at any cost. She criticized the Chinese people for their materialism. “They believe that if only they can earn enough money — at the risk of their own lives — then their family can live in affluence for generations.”

China has failed to establish a code of business ethics, including personal responsibility and corporate accountability, even though it has been years since it embraced the market economy.

China has the world’s fourth largest economy, but it also carries a heavy burden of shame.

This column was contributed by Chosun Ilbo in-house columnist Kim Ki-cheon.

Original report from Chosun Ilbo

Posted in Anhui, Asia, Beijing, China, Counterfeit, Dongzhou, East China, Economy, Food, Guangdong, Health, Law, Liaoning, Life, Made in China, medical, NE China, News, products, Report, SE China, Shenyang, Social, World | Comments Off on China, a Haven for Fake Goods

Chinese Professor Claims to Eat Paper Stuffed Bun

Posted by Author on July 31, 2007

By Qin Yue and Li Ming, Sound of Hope Radio, Via the Epochtimes, Jul 30, 2007-

Just as official Chinese media were questioning the validity of stories surrounding consumer allegations of Chinese pork buns stuffed with paper, one man, while visiting Qufu City in China’s Shandong Province, claims to have personally consumed such an item. Meanwhile, a man on another website confessed to making and selling these paper stuffed food products.

On July 23, a university professor posted an entry on China’s well-known online forum revealing that he had eaten pork buns stuffed with paper on a sight seeing in Shandong’s Qufu on July 20.

“I didn’t feel or smell anything strange when I was eating it,” said the professor. “But afterwards I had a strange aftertaste, sort of like fiber. Later when I threw up, I could clearly tell it was paper and fiber. It felt just like it.”

“I am a university teacher in Shanghai,” the professor recounted in his Internet posting. “Last week I took a trip to Shandong with my family. We went to Jinan City and then Taishan Mountain; the last stop was Qufu. We arrived in Qufu on the evening of July 20 and stayed in a hotel near the bus station (I don’t remember the name of the hotel clearly now, it might be called Guotie Hotel or Guodao Hotel). Anyway, we arrived at the hotel by bus from Taishan Mountain. This hotel is only a five minute walk from the Confucian Temple. You turn right from the hotel and the bus station is next to it.”

“On the morning of July 21, my family and I went to a small restaurant across the street to have breakfast. This small restaurant boasted that served ‘Authentic Nanjing Buns,’ 2.5 yuan (US$.33) for a steamed buns and dumplings. The owner of this small restaurant is a woman who claims to be from Wuhu City in Zhejiang Province and has lived in northern China for 20 years. After we ate the buns, we went to the Confucian Temple. My stomach was not feeling well and I had the taste and feel of fiber in my mouth. All of a sudden I recalled the news I had read on Internet about people stuffing their buns with paper. I asked my wife how she was feeling and she said that she was also experiencing a similar feeling—there was a feeling of having something in her mouth other than pork. I felt terribly nauseous and I threw up after I drank some water. I found scraps of paper in the stuff that I just threw up,” said the professor.

“How horrible this is! The newspaper claimed that the paper stuffed pork buns story was false but I personally experienced it, right here in Qufu of Shandong, which is the hometown of Confucius—the greatest ancient Chinese sage. This is a place that is known as a land of courtesy and propriety for thousands of years, said the professor.”

At nearly the same time, a writer calling himself Li Huaqiang also posted an article on the Website on July 21, confessing that he once made paper stuffed pork buns in his own restaurant. He described the procedure in detail. “Soak the newspaper in oil, heat it up, then dry the newspaper to become crispy and hard and then mix it in with the rest of the stuffing,” he explained. “Later I added vegetables into the mix and combined them together. The final result is greatly improved through this procedure. After playing with and adjusting factors such as temperature, time, meat essence and sauce, etc., I was able to produce paper stuffed pork buns.”

Upon realizing what his son was up to, Li’s peasant father made sure he would no longer serve these to customers. Li added that he did not invent this recipe. “Everyone has their own way of making it, and it is not a secret anymore,” said Li. “Three restaurants near my home are all serving ‘paper stuffed pork buns.'”

The procedure for making this unsavory food item was expressed in detail on Beijing TV’s program “Transparency.” The program explained how one would soak cardboard boxes in a large steel bowl, adding industrial caustic soda to fade and break down the cardboard. After breaking the partially dissolved cardboard into pieces, it was then mixed it into pork stuffing with meat essence to give the final product the look and taste of real pork. Although the method described varied somewhat from Li’s recipe, the result was basically the same.

Although Beijing authorities continue to assert that such stories are false, they removed the “Transparency” program’s producer and two additional employees from office. For the scores of Chinese people who have suffered from fake and poisoned food in the last few months, news of the paper stuffed pork buns isn’t hard to swallow.

– Report from the Epochtimes: Tourist Claims to Eat Paper Stuffed Bun

Posted in China, Counterfeit, East China, Economy, Food, Health, intellectual, Jinan, Law, Life, News, Online forum, People, products, Shandong, shanghai, Social, travel | Comments Off on Chinese Professor Claims to Eat Paper Stuffed Bun

U.S. Liability Lawyers Struggle to Pierce the China Curtain

Posted by Author on July 31, 2007

By Xiyun Yang, Washington Post Staff Writer, Washington Post, Saturday, July 28, 2007-

When Mark Lanier, a liability lawyer in Houston, took the case of a 6-year-old girl who choked to death on a toy, he tried suing everybody in the supply chain: the fast-food restaurant that sold the toy in a children’s meal, the American importer and the toy’s Chinese manufacturer.

The restaurant chain, Whataburger, and the importer settled for an undisclosed amount, but Lanier said he could not even find the proper entity in China to serve with a lawsuit.

With Chinese imports triggering a flurry of product-safety violations in recent months, American consumers have grown increasingly anxious about how and whom to sue, according to lawyers that handle such cases. As Lanier and other have found, the difficulties can be enormous.

While suing companies in foreign countries is always more difficult than pursing a domestic lawsuit, the complexities of filing a case against a Chinese firm are compounded by the country’s regulatory and legal systems and by political relations between Washington and Beijing.

“You’re spitting in the wind,” Lanier said of attempting to sue Chinese companies in U.S. courts. Lanier said his firm has seen a 500 percent increase in the number of inquiries over Chinese goods, but he will rarely take a case unless there is an American defendant as well.

The problems begin before a lawsuit is filed. A Chinese company can only be sued in an American court if it does business on American soil, and not merely over the Internet.

Stephen A. Litchfield, a lawyer for Schneider Electric, is trying to sue two Chinese companies and accuse them of counterfeiting its Square D circuit breakers. “These companies only have Web addresses, no registered Chinese names. They don’t appear to be real companies,” Litchfield said.

Sometimes, as in Lanier’s case, simply finding the right entity to serve with the lawsuit is a stumbling block.

The opacity and scarcity of regulation of Chinese business practices make investigations and evidence-gathering cumbersome and frustrating. Headquarters offices, once found, are often bare-bones operations. Records may be spotty or nonexistent. Unaffected by court orders, the level of cooperation is low. Sometimes the Chinese company will not show up to a U.S. court.

“Getting records is virtually impossible. You can make requests until you’re blue in the face. You’ll just get some token response,” said Stephen Ching, a Philadelphia lawyer with 20 years of experience in China. Ching has been involved in 25 lawsuits against Chinese companies in the last two years.

While Schneider Electric is attempting to obtain a default judgment against the Chinese, which is a judgment made in a company’s absence, enforcement will be difficult. The United States and China have not signed an agreement to enforce one another’s court judgments.

“We badly need it . . . but we can’t expect them to enforce ours if we don’t enforce theirs,” said Jerome Cohen, a New York University professor of Chinese law and member of the Council on Foreign Relations. Cohen said he had never heard of a case in which an American judgment was enforced in China.

Ching estimates that a lawsuit against a Chinese company typically lasts 10 years and costs five times as much as a normal case.

“If it’s a small or medium manufacturer, it’s not even worth considering suing them. It’s not about the merits of the case, they could be dead liable, but it would be too difficult, too lengthy, too expensive,” he said.

The roadblocks to suing a Chinese company have diverted most liability lawsuits to U.S. importers and wholesalers. Litigation lawyers say that while they have seen a spike in the number of inquiries about liability suits, most of the more than 100 pending suits filed over Chinese products target only the American or Canadian importer, the wholesaler or the retailer of the product.

Still, some American lawyers are pursuing litigation against Chinese manufacturers.

“We’re prepared to do what it takes. We have to punish these Chinese companies,” said Jeffrey B. Killino, a Philadelphia lawyer who’s suing the Chinese manufacturer of hundreds of thousands of tires recently recalled over defects that allegedly resulted in two deaths and a brain injury. “We will push and push until we can’t push anymore.”

Killino says it has not been easy. “They’re making us literally take the slow boat to China,” he said.

William Audet, a San Francisco lawyer who is suing Canadian company Menu Foods on behalf of pet owners whose animals died from contaminated pet food, also is getting ready to sue the Chinese companies whose wheat flour made the pet food toxic.

Audet, who says he has gotten thousands of inquiries, is hoping political pressure will be enough to squeeze compensation from the companies.

While large retailers or wholesalers may have the commercial leverage to force Chinese manufacturers to negotiate, some smaller importers have begun factoring liability costs into the price of doing business in China.

Smaller importers are increasingly writing liability insurance into their contracts with Chinese manufacturers and paying third parties to test product quality, said Daniel P. Harris, a Seattle lawyer who writes contracts for American companies outsourcing to China.

Many Chinese companies will accept part of the monetary burden to keep their client, said Sebastien Breteau, who runs a company that inspects Chinese goods on behalf of international clients.

The most cost-effective way to hold a Chinese manufacturer responsible, said Cohen, may not be through the courts. “Publicity may be the best weapon for anyone who can’t afford litigation,” he said.

Original report from the Washington Post

Posted in China, Company, Counterfeit, Economy, Food, Health, Law, Lawyer, Life, Made in China, News, People, Pet food, products, Report, Social, Toy, Trade, USA, World | Comments Off on U.S. Liability Lawyers Struggle to Pierce the China Curtain

China Ignores Real Problem, on Food Issue and Execution

Posted by Author on July 17, 2007

By EZRA LEVANT, Calgary Sun, Canada, Mon, July 16, 2007-

China’s main diplomatic characteristic — saving face — is in overdrive these days in the lead up to the 2008 Olympics in Beijing. So recent widespread problems with Chinese food and drug manufacturing are more embarrassing than usual.

“Made in China” is now synonymous with “buyer beware”.

First it was poisoned pet food exported to the West that killed dogs and cats, then it was toxic fish from Chinese fish farms, toothpaste sweetened with antifreeze, juice with unsafe colour dyes and children’s toys painted with lead paint.

Counterfeit products are rife — brand names and quality certifications on labels are meaningless. It ranges from the massive to the ridiculous: A recent news item out of Beijing reported that a dim sum restaurant was selling pork dumplings with shredded cardboard — softened with industrial chemicals — instead of pork.

The arc of all these stories is the same: The Chinese government denies the news, then tries to explain it, then executes a scapegoat.

It’s the same approach they took during the SARS outbreak; it’s the same approach all dictatorships take, including the Soviet Union’s approach to the Chernobyl nuclear fire.

And so, it was no surprise that China announced that it had executed Zheng Xiaoyu, the head of that country’s food and drug administration from 1997 to 2006.

The government alleged Zheng took nearly $1-million in bribes over that period from food manufacturers.

That’s likely true — kick-backs and bribes are the standard privilege that all senior Communist Party members take for themselves.

But Zheng’s crime in the eyes of China wasn’t that he allowed poisonous food, but that his corrupt trail was caught by the media.

The execution of Zheng was designed to show that China is serious about cracking down on poisonous food, and perhaps even on corruption, too.

But it actually does the opposite. Zheng’s trial was not a real trial, for there are no real trials in China — no presumption of innocence, no rule of law, no rules of evidence and no independent judges.

The judges — as always — are directed by the Communist Party in how to render their verdicts.

They’re more clerks than judges.

Because a real trial is exactly what the face-saving Chinese Communists don’t want.

They wanted a single scapegoat: Zheng. Not a transparent trial. If Zheng had been the head of the Canadian or U.S. food administration, he would have had a lengthy public trial, where prosecutors would have had to publicize the details of his corrupt deeds.

Zheng himself could have implicated others and the whole thing would have been pored over by the public and the media — and by other food manufacturers and bureaucrats. The trial itself would have become one giant teaching moment — where China could have used the law to teach a new, higher moral code when it comes to food and drug safety.

China didn’t do that because it is still a culture of government secrecy and scapegoating. The government wanted someone to blame. Zheng probably was guilty, but a fair trial could have fingered dozens if not hundreds more, and would have forced China to come to terms with its problem.

No doubt, the entire system of food inspection would be overhauled if such a trial were held in the West.

It is only a partial truth to say that China has a food problem — or a pollution problem.

What it has is worse: A dictatorship problem.

– original report from Calgary Sun : China ignores real problem

Posted in China, Commentary, Communist Party, corruption, Counterfeit, Economy, Food, Health, Law, Life, Made in China, medical, News, Official, People, Politics, products, Social, World | 2 Comments »

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