Carat875 fakes, $3.7 million: one parcel bound for a Georgia house
US customs took 875 counterfeit pieces and five handbags at Indianapolis, carrying Cartier, Tiffany and Van Cleef marks. Retail value if genuine, $3.7 million. That is $4,228.57 a piece.
§1Hong Kong to a house in Georgia, stopped at Indianapolis.
United States Customs and Border Protection took 875 counterfeit pieces of jewellery and five designer handbags out of a single parcel at the Indianapolis express consignment facility. The shipment came from Hong Kong and was addressed to a residence in Georgia. Had the jewellery been genuine, National Jeweler and Rapaport both put its retail value at $3.7 million. Across 875 pieces that is an average of $4,228.57 apiece.
§2The usual marks, and who caught them.
The marks on the goods were the ones that always appear. National Jeweler lists Louis Vuitton, Chanel, Versace, Gucci, Tiffany and Co., Cartier and Van Cleef and Arpels; Rapaport's account of the same seizure names Cartier, Tiffany and Van Cleef and Arpels. The pieces were earrings, necklaces and bracelets. Brett Mueller, the Indianapolis port director, credited officers and import specialists working alongside brand owners rather than any single tip.
§3What $3.7 million is, and what it is not.
The $3.7 million is a suggested retail figure and deserves to be read as one. It is what the parcel would have been worth if every piece were real and sold at list, which is not what a counterfeit parcel is worth to anyone, including whoever ordered it. The figure customs publishes is the loss to the brands at full price, not the price paid in Hong Kong. It is the right number for measuring what was infringed and the wrong number for measuring what was smuggled, and the two get quoted interchangeably.
§4The address is the story.
The destination is the part a retailer should read twice. This was not a container into a warehouse or a pallet into a wholesaler. It was a parcel to a house, in the volume a small seller carries, moving through a facility that exists to shift exactly that kind of package quickly. Eight hundred and seventy-five pieces is not personal use. It is inventory, and the channel it was travelling in is the one legitimate online sellers use.
Eight hundred and seventy-five pieces is not personal use.
The enforcement figure that matters to an independent jeweller is not $3.7 million, it is 875. A parcel that size going to a residential address is a small business being stocked, and it will compete on the same marketplaces as the shop down the road, at prices the shop cannot meet, quite possibly using photographs taken from the shop's own website.
Customs caught this one because an officer pulled the package, and there is no reason to think the rate of pulling is high. The trade's defence was never the border, which sees a fraction of what crosses it. It is the authentication layer the resale platforms have built, and this paper has already priced how well that works: one marketplace turns away 38% of the Rolexes it is offered.
The trade, filed to your inbox before the New York open.
Prices, tenders and the one story that moved the industry overnight — read in ninety seconds.
Subscribe free →