SHANGHAI (AP) — An Associated Press investigation has found that Chinese companies hired by Western brands to fight counterfeiting are themselves plagued with fraud. Some agents have been producing the very fakes they were paid to stop.
Some cases involved potentially dangerous products: counterfeit auto parts, pharmaceuticals, personal care products and electrical components.
The AP documented multiple forms of wrongdoing using previously undisclosed records from court cases in China and internal corporate investigations, as well as interviews with people directly involved in events.
Some Western firms paid investigators who were themselves manufacturing or selling counterfeit versions of their clients' own goods. Investigators doctored documents to fabricate raids that never took place. And investigators colluded with factories to make counterfeit goods that they could present to their Western bosses for payment.