Safety lab battling counterfeit UL labels

Monday, September 18, 2006

Overseas manufacturers are using fake labels on items that haven't been tested for safety.

WASHINGTON -- For 112 years, Underwriters Laboratories Inc. has made its mark on everything from fire doors to night lights, with the familiar "UL" seal of approval assuring consumers a product is safe.

The Illinois-based not-for-profit brags that it provides its services at cost to manufacturers worldwide that voluntarily pay the independent testing lab about $700 million a year to have their products inspected.

But overseas manufacturers, especially in mainland China, are making it more difficult for the company to do its job.

Some of their goods are entering U.S. ports with fake UL certification marks.

In July, the company advised consumers that it had not evaluated certain adapters, lighting fixtures and heavy-duty dryer and extension cords circulating in the United States and that all of the products bore counterfeit UL marks.

And in August, the U.S. Consumer Product Safety Commission recalled about 600,000 extension cords made in China that the agency deemed a shock hazard because of undersized wire and substandard insulation. Those cords also bore counterfeit UL labels.

"Even if we have one counterfeit, we're not happy with it," said John Drengenberg, consumer affairs manager at Underwriters' headquarters in Northbrook, in suburban Chicago.

The UL mark appears on 19 billion consumer items a year, advising consumers that products have been deemed safe from electric shocks or other problems. While Drengenberg said the counterfeits are believed to account for less than 1 percent of the total number of genuine marks Underwriters issues, the problem has been "ramping up" in recent years.

Typically, the counterfeit items are sold by street vendors, flea markets and deep discount stores, the company says, and rarely in respectable retail outlets.

Since 1996, Underwriters has had a partnership with U.S. Customs Border Protection and Immigration and Customs Enforcement agents to fight the counterfeiting problem, even involving UL's anti-counterfeiting unit directly in seizures and sting operations.

The company also has trained about 2,000 customs and FBI agents over the years, helping to put a focus on apprehensions at 24 ports, including Chicago, according to Brian Monks, UL's vice president of anti-counterfeiting operations.

Monks declined to give the size of his unit, but said it was "adequate" for the job and he has strong support from the top of the company's management.

"We have staff around the world working full-time on this program," added Monks, who also is a co-chair of an INTERPOL task force on the problem. "We spend millions of dollars a year on the program."

The company also advises the Consumer Product Safety Commission about possible counterfeits so the agency can determine whether to issue a warning or recall.

"CPSC works closely with Underwriters Laboratories to ensure that their seal continues to serve as a trusted mark for consumers to look for in the marketplace," agency spokesman Scott Wolfson said.

The U.S. Chamber of Commerce estimates that counterfeiting and piracy crimes of all types -- not just involving fake UL labels, but everything from DVDs to automobile parts -- cost the nation's economy up to $250 billion a year and a loss of 750,000 U.S. jobs.

The business group has made fighting counterfeiting a major priority, leading efforts to educate the public and politicians about the economic threat and pushing for tougher laws and enforcement efforts. It has also pressed to make the development of intellectual property laws a priority in China, the source of nearly two-thirds of the confiscated counterfeit goods coming into the United States.

"The Chamber believes China has failed to adequately enforce its own laws against counterfeiting and copyright piracy, thereby putting into question China's compliance with its obligations under the World Trade Organization and various other bilateral agreements and accords," Myron Brilliant, vice president of the East Asia section of the U.S. Chamber of Commerce, testified at a hearing on Capitol Hill in June.

Victims including Underwriters generally identify mainland China as the main source of counterfeit goods.

In Miami last month, a federal judge sentenced two counterfeiting defendants, Ji Wu Chen and Meihua Li, who were in the U.S. illegally from China, to more than seven years in prison for conspiring to traffic in several tractor-trailers' worth of goods bearing counterfeit trademarks of Underwriters Laboratories and various other companies.

U.S. Attorney R. Alexander Acosta, in a statement, said the lengthy prison sentences reflected the seriousness of the crime.

Drengenberg said the company is still trying to trace the origin of the extension cords involved in last month's recall. He said experience shows it usually turns out to be a small factory in China that relocates and starts manufacturing something else before it can be found by Underwriters.

Rep. Don Manzullo, chairman of the House Small Business Committee, told the U.S.-China Economic Security and Review Commission earlier this year that, to be effective in the battle against counterfeiting the United States needs to pressure China.

"In other words, we should help them to develop a more effective criminal enforcement regime," the Illinois Republican said. "It is key that the Chinese aggressively criminalize counterfeiting behavior."

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