Dodgy toys could ruin Christmas

Counterfeit and recalled goods pose seasonal threat

Ian Williams, vnunet.com 12 Nov 2007

Recalled and counterfeit toys could pose serious threats to online shoppers seeking the perfect gift this Christmas, according to a new report.

The latest Brandjacking Index study from MarkMonitor revealed that recalled toys continue to be available from online auction sites and "questionable" e-commerce sites.

MarkMonitor also warned that such goods can still be purchased through business-to-business exchange sites which sell in bulk to online and high-street retailers.

A further threat is gift card scams which demonstrate an ever-increasing level of sophistication in persuading consumers to reveal identity information.

Phishing attacks against retail and services brands have jumped 1,100 per cent since the last quarter, according to the report, and now represent 40 per cent of all attacks.

"As the holidays approach, buyers should be wary of online scammers and irresponsible vendors which abuse reputable brands to make a profit," said Irfan Salim, president and chief executive at MarkMonitor.

"The internet has introduced a boundless, multi-jurisdictional playing field that regulatory and industry bodies cannot fully control.

"Brand holders are ultimately responsible for protecting the consumers who trust their brands and their supply chains from fraudulent and questionable internet practices."

MarkMonitor's Brandjacking Index is an independent quarterly report that measures the effect of online threats on brands. The company investigates ongoing trends, and tracks 30 leading brands.

The latest report revealed that 83 per cent of auction listings selling recalled toys ship from the US, more than all other countries combined. The UK is the second largest at six per cent.

Furthermore, eight per cent of business-to-business exchange listings for recalled toys continue to sell the products. MarkMonitor claims that over a million recalled toys are available on exchange sites on any given day.

Consumers should also be wary of spam offers for retail gift cards which lure consumers into providing sensitive personal information. Large price discounts are often indicative of stolen or counterfeit gift cards.

The huge increase in phishing attacks reveals the improved resilience of these sites thanks to the increasing use of fast-flux networks and the rise of phishing kits for hire and botnet rentals.

"The toy recall and gift card findings vividly demonstrate the contrast between how brands are protected in the internet world versus the physical world," said Frederick Felman, chief marketing officer at MarkMonitor.

"Brand holders need to develop comprehensive and aggressive strategies to protect consumers who not only trust their names in stores, but in online venues as well.

"They also need to recognise that the internet has the potential to contaminate supply chains to bricks-and-mortar vendors. If brand holders do not move aggressively, they put their customers, reputations and revenues at risk."

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