E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
Investigators have seized the assets of 70 web sites that mimicked legitimate sites.
The e-commerce sites seemed real, with authentic-looking merchandise and SSL certificates meant to convey that they were safe places to do business. In fact, many of them looked so good it would be hard for even the most discerning consumers to tell them from legitimate sites, federal authorities say.
But acting on tips that the sites were selling counterfeit items shipped from overseas to consumers in the United States, investigators with the National Intellectual Property Rights Coordination Center, or IPR Center, announced Thursday they had seized the assets of 70 web sites that closely mimicked legitimate sites but that had duped consumers into purchasing fake goods. The IPR Center is operated by agents of the U.S. Immigration and Customs Enforcement agency’s Homeland Security Investigations unit.
The 70 e-commerce sites—which sold products including clothing, baby carriers, jewelry, luxury goods, language and fitness DVD sets, and professional sports jerseys—have been shut down and their domain names placed in the custody of federal officials. Visitors to the sites now see only a seizure banner noting that the sites have been seized and that willful copyright infringement is a federal crime. Authorities did not identify the seized sites.
The action was the latest in a series of investigations into illegal web site activity that federal authorities call “Operation In Our Sites.” The 70 sites most recently seized brings to 839 the number of web domains seized over the past two years.
But while adding to the list of seized web properties, federal authorities also note that criminals are learning new tricks. Project Copy Cat discovered a new twist in fraudulent sites with the appearance of Secure Sockets Layer, or SSL, security certificates that are usually issued only by official certificate authorities to web sites found to be legitimate. Federal officials did not comment in their announcement this week on how criminals were able to receive and display the certificates. A call to the National Intellectual Property Rights Coordination Center was not immediately returned.
Warrants for the seizure of the 70 sites targeted by Project Copy Cat were issued by U.S. Attorney’s offices in western Texas, southern Texas, New Jersey, Colorado and Utah.
In a prior investigation, the IPR Center, after acting on a tip from the Motion Picture Association, seized the assets of NinjaVideo.net in 2010 after determining that the site was distributing to millions of site visitors pirated copies of legitimate movies and other audiovisual products. As of this week, that investigation has resulted in the arrest and conviction of five of the six alleged co-conspirators; the five have received sentences ranging from 22 months in federal prison to three years of probation, federal officials say. The convicted criminals also paid a combined restitution of $470,000.