LAPD investigation reveals that gangs have turned to counterfeiting to balance their criminal portfolios

June 14, 2010 § Leave a comment

Flip on the local news for a few minutes and you are sure to be bombarded by stories about the battered economy. And while evidence of this financial anathema may seem overwhelming, we are resilient creatures designed to take a few knocks, grow some calluses and move on. We adapt. But it is not just the happy elements of society that adapt, it is all parts: from the highest echelon of grandmothers and confectioners all the way down to the skeezier sort that prefers to hold tea socials at dog fights. The recession, it can be said, has caused some gang leaders to adjust as well, and they have become savvier business managers because of it.

The only thing is that they are using counterfeits to do so.

A recent series of investigations by the LAPD uncovered that gang bangers have started treating their catalog of criminal activities like a stock portfolio. They are using the sale of counterfeit goods to offset the risk of more traditional illicit enterprises. By slinging bootleg CDs and DVDs, they are making dollars faster than they would with traditional crimes. Better still for them, they can do it without all the usual hazards.

Classic criminal enterprises like drug sales, prostitution, kidnapping, burglary, extortion, shakedowns, and the like require violence to make a profit, whether it is actual or threatened. The drug trade is the only industry on the planet where building a better product or improving a manufacturing process will not help you grow. Instead, growth requires that you violently dispossess competitors of their trade routes and assets. Because the demand for drugs is so high and the quality is of relatively little importance, you can succeed in the business by maintaining a good supply chain and having the dry powder and buckshot to keep the deed.

Gang leaders are concerned with casualties only as far as it affects their profits. If your crew is band-aided up watching Maury Povich instead of slinging rock, it is going to be tougher to make your mortgage payments. Unfortunately, the counterfeit trade seems to have bridged this gap, by keeping “employees” out of harm’s way and selling product.

The LAPD report claimed that the money made by the gangs through the sale of fake goods has funded the purchase of weapons and the growth of other illegal businesses. Because counterfeits are relatively cheap to make and the distribution cost, or the amount it costs to successfully get the goods in the hands of consumer and the cash in the hands of the gang members, is relatively low, it has been a very effective way for the criminals to raise capital.

This is another example of how a seemingly ‘victimless’ crime is anything but. In the case of the fake trade, there are the victims that produce the fakes against their will and do so in at great risk to themselves and others. Then, there are the other victims harmed indirectly by the sale of sham goods, like those who are wounded by terrorist attacks or gang shootings.

The LAPD claims, as we do, that the best way to prevent this activity is to curb the demand for the fake goods. The police will keep fighting on their end, as all enforcement agencies will, but at the end of the day, it can feel like throwing haymakers in a steam bath. Where we need to focus our efforts as civilians is to stop the demand for fake goods.

Once the world knows just how parasitic and abusive the fake trade is, it will only be a matter of time until the sham industry’s lifeblood runs out of it, like a cheap dye seeping from some shoddy material. So spread the word and encourage your friends to do the same. We can end this abuse in our lifetime.

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