Flea Market Raid: Homeland Security Cracks Down On Counterfeit Goods

A Homeland Security investigation led to a raid at the Patapsco Flea Market in Baltimore over the weekend.

Could this be the end of the local flea market?

In an effort to crack down on counterfeiting, the Department of Homeland Security has begun targeting flea markets across the country in a series of high-profile raids that's led to the seizure of millions of dollars worth of merchandise.

The latest example is a recent raid in southwest Baltimore at Patapsco Flea Market, a 300,000 square foot space where 250 small vendors hawk goods and oddities -- everything from live crabs to jewelry to clothing. Only open on Saturdays and Sundays, the marketplace was shut down this past Sunday after a two and a half year investigation by the Department of Homeland Security, which found that the market was selling counterfeit merchandise, The Baltimore Sun reported.

Federal agents discovered that nearly 70 percent of the brand name items at the store were allegedly fake and being sold as Nike, Polo, North Face, Louis Vuitton, Gucci and other brands. Confiscated items included 8,911 counterfeit DVDs worth $122,210; 10,699 counterfeit CDs worth $128,000; and 1,728 counterfeit items, including handbags, NFL merchandise and sneakers worth $648,000, according to the International Business Times.

“ICE Homeland Security Investigations (HSI) special agents are executing a federal search warrant at the Patapsco Flea Market as part of an ongoing criminal investigation,” said a U.S. Immigration and Customs Enforcement statement provided by spokeswoman Nicole Navas. “HSI special agents, with assistance from our law enforcement and industry partners, are seizing what is believed to be counterfeit, pirated and unlicensed merchandise that was being sold at the flea market. In order not to compromise this ongoing enforcement action, no additional information can be disclosed at this time.”

It appears that Homeland Security is putting more pressure on flea markets to ensure that their products are legitimate, evidenced by another high-profile raid that resulted in the seizure of 21,308 items worth an estimated $900,000 at an El Paso, Texas, flea market just a few days prior. Counterfeit media and merchandise has proliferated online, but as the raids indicate, remain a significant and potentially growing problem on the ground as well. The Washington-based International AntiCounterfeiting Coalition values the global trade in illegitimate goods at $600 billion a year, rising from $5.5 billion three decades ago, The Sun reported.

Since its inception in June 2010, Operation In Our Sites (IOS) has resulted in the seizure of 758 domain names, 11 criminal arrests and the seizure of over $1.3 million, according to data provided by Navas. Launched by Immigration and Customs Enforcement in conjunction with Homeland Security Investigations, the initiative has found that 705 of these domains offered tangible merchandise, and 53 offered intangible media products via downloads or streaming.

Benefitting from a $43.2 billion increase in its 2012 budget, as reported by The Washington Post, Homeland Security now has even more funding to conduct elaborate stings on counterfeiters. Apart from raids in 1996, 2004 and 2006 for similar offenses at Patapsco, undercover agents even rented out small booths at the market in April and May 2011 to scout the premises, The Sun reported. Much of the sale of counterfeit goods is handled in cash, allowing the business to avoid taxes. The affidavit reveals that cash deposits at Patapsco were often mixed with money from the Patapsco Bingo Hall, a building across the parking lot. The affidavit also says that both spaces "appear" to be owned by the Brzuchalski family, who could not be reached for comment.

Questions remain what the raids might mean for small, legitimate retailers at flea markets like Patapsco, who use the venues as means to earn a living -- and how many more the government may have planned.

Comments

[tygrone]

12:24 AM on 05/06/2012

The situation is probably very complex and the details are not divulged by DHS, but these "fake or counterfeit" products are probably made in China and imported into the US under the inspection of DHS. Why is there no information seemingly available to point out the origin of these products. It is odd that CBP and ICE, both under DHS, must be either not inspecting or simply allowing "fake or counterfeit" products into the US only to spend resources to seize later. The products should not be allowed into the US in the first place. Hope that the American courts also find fault in the country's handling of the borders to which fake merchandise has apparently unfettered access. If it takes two years to take an action of this magnitude, there is much to profit for both the foreign manufacturers and American importers/distributors. I hope that if there are criminals behind these operations we will find out they were caught, though unlikely if they are in China. Please look into the policy results or court outcomes of federal resources in a city like Baltimore, ridden by crime, poverty, low education, and unemployment. 2.5 years of spending at a school might yield more for the future of Baltimore than allowing low quality and fake products to come into the US, under the guise that it hurts American firms that have moved all the jobs to the same country sending the "fake" products. How ironic and perverse?

[walker1946]

08:52 AM on 05/04/2012

WE have probably 30 shoe Dealers at The Flea Market in Ft.Mill,S.C.every weekend, Usually the Local Police scan the Market and they do find the ocassional Pocket books and mostly C/Ds.that are counterfiet. The S.C. Tax Division need to come in and make sure they are filing there monthly tax reports. One Dealer has 10-12 spaces. Where is Customs checking for Illegal People. It's look like Mexico everyweekend.

[Chase Poore]

05:46 AM on 04/30/2012

First of all no one is robbing anyone. The people who buy these products KNOW that they are knockoffs. Also, LV and these other designers are NOT losing money. The people who purchase knockoffs could never afford to pay $3,000 for a purse anyway.

[IslamicPacifist]

04:44 AM on 04/27/2012

People only buy counterfeits because the originals are priced out of it's market

[thomgrisso]

11:08 AM on 04/26/2012

I am with the many puzzled WHY home land is this not an FBI thing across state line hmmm More fabricated govt jobs ... These are not terrorist .... There are over 200 vendors and you catch 5 dealing ...Go to ebay and see five hundred anyday... The again that would not be homeland ...

[Autora]

12:22 AM on 04/26/2012

Good! For once, HSA does something I am totally behind. This was not a regular flea market, as you might find in your own neighborhood-- it was a business trading in counterfeit goods. You don't go to a flea market to find knock offs of brand names, for crying out loud.

Counterfeit goods are a huge problem, as they are usually produced by sweat shop/child labor abroad, and often those behind them are laundering money, supporting terrorists, and so on. It's an organized crime way of making quick bucks.

Anyone wanting more info can do a fast check on any fashion magazine site, which have been against this for years. Google 'Fakes aren't Fashionable.'

[killkubota]

11:00 PM on 04/25/2012

Since when did this federal agency have the jurisdiciton to worry about counterfeit clothes? TSA and HSA need to be cut and cut deeply.

[streve]

10:13 PM on 04/25/2012

And this is a shock??? Isn't that what flea markets do? Rip people off? I have only been to 1 or 2 flea markets, and the merchandise is shabby, out of date or just bad, So why people would want to shop at 1 is beyond me. O well to each their own I guess

[Autora]

12:26 AM on 04/26/2012

A real flea market is the antithesis of what you are describing. It is people bringing in goods they can no longer use or want, and often willing to barter for something you may have that YOU don't want or use.

This place was not a flea market: it was a mall masquerading as something else.

[Jr Palmer]

09:38 PM on 04/25/2012

well what gets me is all this stuff comes thru customs in the frist place has any one thought of that so who is getting bought off in the customs deptments ? Good question , So why dont they just seiz it at customs when it is brought in to the country ? anybody think of that , it is because they have to justify thier jobs, Because if they seized it at customs then they would not need as many agents in the field hello did the lite come on yet.JUST SAYING

[Autora]

12:29 AM on 04/26/2012

Nope. Paid no customs. This is counterfeit, and it doesn't enter the country legally. Nobody is going to declare: here I have one ton of counterfeit goods, what's the tax on that?

[envirolarry]

09:28 PM on 04/25/2012

"Could this be the end of the local flea market?" give me a break Huffington. Obvioulsy they don't care that every conterfiet product is another lost job here in America. They are such Socialists!

[Elvira Walker]

08:43 PM on 04/25/2012

Asian stores are notorious for fake goods. But, they don't say it is the real thing. They just make it look like the real thing.

[david68574]

08:17 PM on 04/25/2012

This is unbelievable. Flea markets are selling counterfeit merchandise?? I'm shocked. SHOCKED!!!!

[streve]

10:14 PM on 04/25/2012

LOL

[ladyofib]

08:11 PM on 04/25/2012

Wow thank God they found those fake Nikes!! Now I can sleep better at night! Seriously, is this what we are spending money on when we are so broke?

[thomgrisso]

11:11 AM on 04/26/2012

Say it ain't so... you mean I really did not get the real deal when I paid 30 for those 100 dollar kicks!

[caliwntrprk]

08:07 PM on 04/25/2012

I am confused obama said the other day the war on terroism was over

[ERDOC39]

07:57 PM on 04/25/2012

"...benifiting from a $42 BILLION DOLLAR INCREASE in their budget...." they're able to seize a few million dollars worth of goods...our tax dollars at work. Could not DHS find some other, more productive way to ensure our safety ?

[thomgrisso]

11:14 AM on 04/26/2012

What 42 billion increase .... Remember making a profit is evil running a loss is the way ... Don't wory taxes can be raised ... Too bad you are out of work you should apply to HLS we are hiring the recession is over !!!