Counterfeits infecting your supply chain

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Counterfeits infecting your supply chain

From Italy, Germany, Netherlands and finally to China – SKF Brand Protection Team recently unraveled a complex chain of counterfeit supply, traced in several steps back to a source in
China.

The case highlights the importance of knowing your supplier’s supplier, and how sources perceived as safe can be highly “contagious” in terms of counterfeit supply.
A “safe” source can infect the whole supply chain Are your sources really safe?
The story started with one of the numerous raids that law enforcement officials carry out across the globe against suspected counterfeit traders, this time in outskirts of a town in
northern Italy. During the raid, several counterfeit products were identified and confiscated by Italian Financial Police (Guardia di Finanza). In order to track down the source and stop
potentially dangerous goods from spreading in the market, SKF requested that the Italian company disclose their source for the counterfeit goods.
The Italian company’s owner, which had been caught with the fake goods in stock, refused to believe the products could be counterfeit. He had purchased them from a “safe” distributor in
Germany, whose owner he claimed to know personally very well. After a prolonged legal process, SKF Brand Protection Team finally managed to learn the source, and the authorities
ordered the confiscated goods to be destroyed.

From the Italy to Germany
Once learning of the source in Germany, SKF Brand Protection Team moved quickly to track down the company, using the evidence gathered in the Italian raid. The German trader
understood the seriousness of the situation, and eventually agreed to cooperate with SKF; disclosing full information on other customers that had been affected, and the source of the
counterfeit goods. Their supplier was a trading company in Netherlands. An investigation of the Dutch supplier revealed another company in the Rotterdam area as the original importer
to Europe.

Rotterdam – “the Gateway to Europe”
Being the largest port in Europe, and having a strategic location on the North Sea,
Rotterdam is sometimes referred to as “the Gateway to Europe”. This was also where the counterfeit bearings were imported into Europe. The Rotterdam-based company had
previously tried to import counterfeit bearings, which Dutch customs successfully had stopped and destroyed. With this second case the company had made a final wrong move,
and was forced to close operations last year (2014). During the investigation, it was found that the Rotterdam trader had convinced some customers that he had a reliable source in
Asia, whom purchased directly from “SKF in Singapore”.
The only proof provided, was a scanned copy of an old shipping label, which unfortunately mislead some customers. As often in these cases, the actually supplier was based in China,
not in Singapore, and had no affiliation to SKF. Customers should also note that not only shipping labels are copied, even fake certificates of origin/conformity are circulating. If
counterfeiters can make counterfeit bearings, which visually are looking better and better, one can imagine how easily they can make a fake piece of paper.
A long and complex route to market, with several pitfalls This case stresses the complex route to market counterfeit goods can have, and that no matter how safe a supplier seems, counterfeits can enter the chain at many points. The case showed how several companies acted opportunistically, looking for “good deals” on the market, and some went further to willfully trick customers. Furthermore it shows the importance of being suspicious of companies claiming to have a supply “directly from” SKF,
or distributors that previously were authorized by SKF.

The most reliable source of current authorized SKF distributors is available on www.skf.com, under “Find a distributor”.

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