Counterfeit Goods Put American Consumers at Risk This Holiday Season

Washington, D.C. (December 2, 2019) – As Americans prepare to celebrate the holidays with family and friends, international sellers delivering counterfeit goods to the U.S. put communities and lives across the country at risk.

Millions of Americans will choose to purchase their gifts online this holiday season. Lured by good deals and convenience, Americans regularly order products that are manufactured in foreign factories or through third-party businesses overseas, often in China.

With this surge in foreign goods comes an increased risk of dangerous counterfeits, which are often ordered unknowingly. A new report from the Senate Finance Committee, led by Chairman Chuck Grassley and Ranking Member Rob Wyden, warns of a growing global counterfeit trade as well as of an “increasing sophistication” that makes these fake products harder to detect and distinguish.

Counterfeit goods cause more than economic harm – from exploding batteries to toys containing lead paint, these knockoff products pose serious risks to health and safety. Yet thanks to a loophole in the global postal system. U.S. Customs and Border Protection (CBP) and other law enforcement agencies lack the tools needed to effectively screen the massive number of incoming foreign packages for dangerous illegal material, ranging from toxic or dangerous counterfeits to illegal synthetic opioids.

Congress passed the Synthetics Trafficking and Overdose Prevention (STOP) Act of 2018 to close this loophole in the global postal by requiring that all international packages delivered by the U.S. Postal Service (USPS) include vital security information known as advance electronic data, or AED – as is already required for private carrier deliveries. Over one year after this law was passed, however, its provisions remain unfulfilled and unenforced, putting lives across the country at risk.

The STOP Act required the USPS to have AED on 100 percent of packages entering from China and 70 percent of foreign packages overall by the end of 2018, but a bipartisan Senate letter found it fell short. Even as we near 2020, these deadlines still have not been met. As a result, postal workers and law enforcement officials lack the AED they should have by law and will face serious hurdles in keeping dangerous shipments out of the U.S. The USPS and the Department of Homeland Security were also required to issue regular reports on their progress and AED compliance to Congress, but these have not been made public, leaving the American people in the dark on this major security issue.

The Senate Finance Committee report highlights how a lack of AED has supported the illegal counterfeit trade, noting that the AED required by the STOP Act is “useful to target and prevent counterfeit goods. The report also warns of serious safety hazards for consumers and estimates that counterfeits cost the U.S. economy between $29 and $41 billion per year – sales that would have otherwise supported American businesses, ingenuity and crucial industry jobs.

“Bad actors and criminal cartels exploit these vulnerabilities to avoid detection by law enforcement and make millions in the process. The holiday season should be filled with joy, but instead we’ll face danger and uncertainty if we don’t take stopping these threats seriously,” said Juliette Kayyem, senior advisor to Americans for Securing All Packages. “The STOP Act was passed to keep Americans safe from these global threats, which is why it is so troubling to see the law is not being enforced. The loophole in the global postal system must be closed once and for all to give officials the ability to effectively screen packages and keep Americans safe this holiday season.”