Meta, which owns Facebook, is struggling to stop counterfeiters from shoving fake luxury products from Gucci and Chanel into its social networking apps as the company moves into e-commerce.
“Facebook and Instagram are the main marketplaces where counterfeit goods are sold. It used to be eBay ten years ago and Amazon five years ago,” said Benedict Hamilton, director of Kroll, a private investigation firm hired by brands harmed by counterfeiting and smuggling.
The survey, led by social media analytics firm Ghost Data and shared with Reuters, showed counterfeiters selling knockoffs of luxury brands including Gucci, Louis Vuitton, Fendi, Prada and Chanel.
More than 26,000 accounts of active counterfeiters operating on Facebook and more than 20,000 on Instagram were identified, up from the previous year’s count but below the peak of 2019, when around 56,000 accounts were identified. About 65% of accounts found in 2021 were based in China, followed by 14% in Russia and 7.5% in Turkey.
The OECD (Organization for Economic Co-operation and Development), which estimated that the global trade in counterfeit goods reached US$464 billion in 2019, said an explosion in e-commerce since 2020 dictated massive growth in the supply of counterfeit goods online.
Academics said fraud grew rapidly during the Covid-19 pandemic, while legislation in the United States and the European Union remained unable to combat it.
Chanel, Gucci and Prada said their fight against counterfeiters took down hundreds of thousands of social media posts last year, but did not comment specifically on Meta’s services. LVMH, which owns Vuitton and Fendi, which said it spent $33 million to fight counterfeiting in 2020, declined to comment.
In a recent report, the company said it removed 1.2 million fakes from Facebook from January to June 2021 and about half a million from Instagram. The company said it also proactively removed 283 million content from Facebook that violates spoofing or copyright infringement rules, and about 3 million from Instagram, before it was reported by brands or before it was released.
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