Meta platforms centres for counterfeit trade

The Meta platforms, from Facebook Marketplace to Instagram, are teeming with counterfeit articles. Most popular victims are the major luxury houses, especially Louis Vuitton.

Chinese multi-billion dollar business

Counterfeiting on social media is a global threat, Ghost Data concludes in a new study. Just as Interpol and the European Union previously concluded, counterfeit goods have become even more prevalent online since the coronavirus pandemic. Facebook (Meta), in particular, is attracting a large mob of “ruthless counterfeiters” as the platform focuses more and more on e-commerce but fails to control cheaters, the researchers say.

In 20 days’ time, in October 2021, Ghost Data spotted 26,770 accounts of counterfeit sellers on Facebook alone. These are mainly counterfeiters based in China (65 %, up from 43 % in 2019), but to a lesser extent also in Russia (14 %) and Turkey (7.5 %). On Facebook and Instagram together, there are said to be 6,000 to 7,000 Chinese wholesalers who distribute their counterfeit products through countless accounts and achieve an annual turnover of between 1.6 and 1.9 billion euros.

60 % Louis Vuitton

So, who are those customers and what do they buy? The full reach is difficult to estimate, but Ghost Data estimates that these 26,770 accounts have at least 20 million customers. – this concerns people who are ‘friends’ with the counterfeiters on Facebook and who therefore explicitly follow them. However, via Marketplace and other ways, the number of buyers will rise much higher.

Products on offer are primarily fashion items and accessories from the large luxury houses. Almost 68 % of the fake products depicted have a reference to the LVMH group, six out of every ten cases involve counterfeit Louis Vuitton items. The other victims are copied nowhere nearly as often: not even one in ten (8.5 %) counterfeit items on offer pretend to be Chanel, 6.7 % represent Fendi. Gucci and Prada each account for about 3 %.

Persistent problem

The problem, however, is not new: as far back as 2014, Ghost Data denounced that Facebook was advertising with counterfeit products. In 2020, in the midst of the corona crisis, the researchers discovered a huge scam involving more than 10,000 accounts selling fake face masks on Instagram. Earlier this year, another investigation revealed a series of wholesalers who were openly selling “fake” Apple products on the social network.

Meta responds that fraud and counterfeiting are inherent to new technology, but that the company is getting better every day at preventing and tackling it. Ghost Data counters, however, that Meta reacts insufficiently and does not act drastically enough. The counterfeiters are also constantly finding new ways to stay under the radar. This also makes it difficult for the rightful brand owners to respond.