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  1. Homeland Security Investigations
  2. What We Investigate
  3. Intellectual Property Theft and Commercial Fraud

Intellectual Property Theft and Commercial Fraud

Intellectual Property Theft and Commercial Fraud

Every year, trillions of dollars in goods are imported into the United States. Unfortunately, not all of that is done in accordance with U.S. law.

Intellectual property theft and commercial fraud are not victimless crimes — criminals take advantage of people looking for a good deal and steal proprietary information from American businesses.

These crimes impact Americans at the individual and national level. Fake goods sold at low prices harm our families and friends; dangerous and cheap goods flooding the market harm our economy and the country at large. Stolen data and proprietary information directly harm businesses and consumers, too.

HSI is a key player in the U.S. government’s fight against intellectual property theft and actively investigates illicit imports and pirated content that violate rights holders’ copyrights and trademarks. HSI prioritizes its intellectual property investigations to address the most egregious criminal schemes that threaten U.S. economic and national security and public health and safety.

Understanding Intellectual Property Theft and Commercial Fraud

Every year, people and businesses import trillions of dollars in goods into the United States. Unfortunately, some people and companies don’t follow U.S. laws.

HSI investigates general commercial fraud, focusing on violations of import laws and regulations that involve false or fraudulent documents, statements and practices. Our most common investigations involve predatory trade practices and the introduction of goods that may create public health and safety risks. These schemes include:

  • Falsifying imported goods’ true value or countries of origin.
  • Misclassifying goods to evade duties.
  • Customs brokers failing to comply with import laws.

Buying knock-off purses, electronics and medications may seem harmless on the surface — everyone wants to save money and find the best deals. However, doing so threatens public health and safety, the U.S. economy, and national security by introducing harmful and banned materials into the market while supporting illegal labor practices.

The U.S. government can’t oversee counterfeit items, which means our regulations and laws can’t keep you safe.

National Intellectual Property Rights Coordination Center

HSI leads the National Intellectual Property Rights Coordination Center (IPR Center), which the U.S. government created to stop global intellectual property theft and enforce trade laws. Comprising federal agencies and industry experts, the IPR Center plays a significant role in policing websites, social media and the dark web to stop criminals from selling and distributing counterfeit goods.

HSI and the IPR Center rely on partnerships with the private sector, academia and all levels of government to stop the criminals who threaten U.S. businesses, rob hardworking Americans of their jobs, and negatively impact our economy.

The Impacts of Intellectual Property Theft and Trade Fraud

Intellectual property theft and commercial fraud have significant impacts on individuals and the economy, such as:

  • Economic losses. These crimes result in substantial economic losses for businesses. Criminals sells fake goods at low prices, creating unfair and illegal competition in the market. This can lead to Americans losing their jobs and small businesses being forced to close.
  • Healthy and safety risks. Counterfeit products expose consumers to unsafe merchandise and other goods that don’t meet U.S. health and safety standards, including pharmaceuticals that contain harmful ingredients or knock-off electronics that malfunction.
  • Organized crime. Counterfeit goods and pirated content put consumers’ financial information at risk. Criminals don’t limit themselves to one crime; while selling fake goods or providing illegal streaming services, they can also steal identities and financial information. Their illicit proceeds fund further crimes that harm U.S. communities and consumers.

HSI's Response to Intellectual Property Theft

HSI leads nine national intellectual property enforcement operations that focus investigative efforts on fraud and violations related to:

  • Pharmaceuticals
  • Health and beauty products
  • Pirated copyright content
  • Tobacco
  • Automotive, aerospace and heavy industry components
  • Consumer electronics
  • Sports apparel and equipment

HSI also protects U.S. government and Department of Defense supply chains.

Our special agents identify places at high risk of being exploited for IP theft and commercial fraud, such as universities and research centers, military bases, major sporting events and digital databases. We work with specialists who identify counterfeit merchandise, pirated content, false declarations of imported goods’ value or country of origin, misclassified goods, and instances of copyright and trade law infringement.

We protect U.S. consumers and the economy by leveraging our trade authorities, expertise, and domestic and international partnerships to stop criminals from importing and exporting counterfeit items and proprietary information.

How We Can Help Each Other

You can play a crucial role in preventing intellectual property theft and commercial fraud by taking the following actions:

  • Buy from reputable sources. Only purchase goods and services from legitimate and reputable sellers, retail stores and online marketplaces. If deals seem too good to be true, they may be counterfeit or pirated products. By purchasing from legitimate sources, you help incentivize innovation and fair competition in the marketplace.
  • Check for authenticity. Check products for signs of authenticity, such as serial numbers, trademarks or logos. Be wary of products that look suspicious or don’t match the quality and packaging of genuine items. Look for prices that appear lower than what you expect to pay.
  • Report suspicious activity. Report potential violations to the IPR Center.

You can help keep the marketplace fair and safe for everyone by knowing how harmful counterfeit goods and fraudulent trade practices can be.

To report suspicious criminal activity or suspected fraudulent trade practices, call the HSI Tip Line at 1-877-4-HSI-TIP.

Last Updated: 04/22/2024
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