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Drug cartels grab a piece of knock-off market

Counterfeit goods controlled by smugglers

Federal agents in El Paso are investigating the link between counterfeit and pirated merchandise and organized crime, specifically Mexican drug cartels. A knock-off Michael Kors handbag sold here can be connected to the bloodshed in Ciudad Juarez. (with videos)
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2 comments on this story

Jul 1, 2012, 12:50 pm
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“This new surge in cartel involvement in counterfeit merchandise is a direct result of the high demand for fake merchandise. And cartels, opportunistic by nature, are taking over the bootleg business to make money. This money is being used to supply firearms, ammunition and other artillery to wage war between cartels.”

Cartel, i.e. organized crime, involvement in counterfeit goods production and sale is a non sequitur. Organized criminal gangs will make money wherever there is money to be made. To say that sales of fake brand name handbags are buying ammunition, though, is ridiculous. Ammunition is a business expense for these guys, and it’s counterfeit handbags and t-shirts as well as grams of cocaine that specifically fund ammunition purchases.

Yes, purchasing counterfeit handbags and DVDs supports the cartel, but to suggest that if consumers stopped patronizing street vendors of counterfeit brand name goods the cartels would wither and die is laughable. They continue to make their big money from drug sales, and we Americans continue to be their very good customers.

Jul 1, 2012, 1:27 pm
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@Roberto De Vido

Counterfeit goods are a $12 billion-plus black market in Mexico. In addition to handbags and DVDs (some 90 percent of movies sold south of the barder are bootlegged), the cartels sell faked presecription medicines.

The cartels, which are in de facto control of many Mexican cities, now make only 50 percent of their money from smuggling illegal drugs. The profit margins are higher in counterfeiting and the risks are lower than with smuggling drugs - although much of their revenues stem from other crimes, including kidnapping, extortion and hijackings.

The trade in bootlegged goods has severely hurt segments of the Mexican economy - hundreds of millions of counterfeit shoes made in Asia have killed the footwear industry in Mexico, for instance.

The cartels seem to take pride in their goods - bootlegged software and movies are frequently marked with cartel logos.

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