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Fight against counterfeiting

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Is counterfeiting an inevitable phenomenon of globalization with few serious consequences or a real challenge that the international economy has to fight?
Source: Flickr

Precious feedback from the security printing industry

Jacques Laurent | translated by: Gabriela Stuparu | 2016. December 02. 17:40

Counterfeiting is an economic disaster with implications that affect public safety. Its consequences and cost are frequently underestimated. However, in the fight against counterfeiting, feedback from the security printing industry should be carefully weighed. Life at Oberthur Fiduciaire, one of the global leaders for the printing of banknotes, shows to what extent fighting against fake products is a high-tech job that does not leave room for improvisation.

"Adadas" sneakers, "Lewis" jeans, “Rotex” watches… Some counterfeit products on African or Asian markets for tourists make us smile, because the fake products don't seem serious at all. These are “honest” counterfeits because they will not deceive any consumer with some common sense. Those claiming to be original products are a different story. But if a Western tourist believes that buying an original Cartier watch or a Vuitton bag in a Lebanese souk for 5% of its real price is feasable, then the small-time counterfeiters have good times ahead.

Counterfeiting spares no sector. In any case, even though it is severely punishable by law, the counterfeiting of clothing or luxury goods does not represent the same danger as other types of counterfeit products: fake drugs and medicine, fake brake pads, fake electronic products manufactured without any safety standards, fake alcohols… From automotive parts to medicine through banknotes, counterfeiting, often practiced at an industrial scale, can jeopardize companies (Lacoste lost more than 5% of its annual income because of counterfeit), weaken an economy and even cause fatal casualties. The Union of Manufacturers for the International Protection of the Intellectual Property (UNIFAB) recently submitted to minister Michel Sapin a report on the links between terrorism and counterfeiting. According to Eyes of the World (Yeux du Monde), certain terrorist movements in financial difficulties would turn to DVD piracy to find a source of income.

At global level, counterfeiting represents a total income of 300 billion euros, which of course evades all fiscal administration and it rarely ends up in the pockets of philanthropists. The sector of European leather merchants and jewelers alone came short of 3.5 billion euros in a year. In France, counterfeiting adds up to a loss of 6 billion euros per year. And the phenomenon is not going away soon: the number of counterfeits seized has been steadily increasing in the past several years. The cause: the explosion of purchases on the Internet, the web being a major provider of counterfeit goods. Even branded websites are counterfeit, just like the rip-off Ray-Ban glasses that circulated for a while on Facebook. The only sector in which counterfeiting has been under way for several years is the counterfeiting of banknotes. But it is true that on this subject, the security printing industry is well prepared: if software counterfeiting is a relative novelty, banknote counterfeiting has always been a common activity. Therefore, the experience accumulated by security printers in the fight against this scourge is quite considerable.

*The culture of protection and technology

The first condition for an efficient fight against counterfeiting: accepting the reality and seizing the phenomenon. In this matter, the security printing industry is more than ready: “Our business has this particularity that we must not only stay one step ahead of our competitors, but also ahead of counterfeiters against whom we are running a real-time race” explains Thomas Savare, CEO of Oberthur Fiduciaire, a French banknote printer. Counterfeit attempts are as old as the notes themselves. The fight against the possibility of product falsification is, hence, inherent in the design of the product.

In addition to control and rigorous selection of suppliers and “raw material”, the security printing industry can only rely on intensive research and development, which is why most banknotes are renewed regularly, just like the images on euros. From one generation of notes to another, everything - or almost everything - is changed, sometimes in an indiscernible way. Inks, papers, patterns, formats, technologies…everything changes or almost everything, but always for the same purpose: protection, traceability, durability and acceptability (by the population that will have to own it). The goal is to have in circulation only those banknotes that incorporate the latest refinements in technology. And as far as technology is concerned, the security printing industry knows exactly what it's talking about. “Security printing is an industrial activity with a very high technological content. Certainly, paper money has existed for centuries, but today’s banknotes have almost nothing in common with those of the past or even with those in circulation a few years ago. They are true products of technology and the fruit of permanent innovation.” confirms the General Manager of Oberthur Fiduciaire.

Unfortunately "technology" frequently rhymes with “cost” in the collective imagination. It is for a good reason that Oberthur Fiduciaire invests more than 5% of its income in research and development: “We regularly file new patents covering the technologies that we implement, in two sectors of research and development in particular: security (with anti-scanner technologies or the optimal effect patches for example) and the banknotes paper durability” confirms Thomas Savare.

Despite that the price costs only around tens of centimes per note, each banknote incorporates several dozens of different anti-counterfeit technologies and at least as many processes: dynamic embossing, heliography, flexography, holograms, watermarks, magnetic tapes and from now nanotechnology… Four criteria are decisive for the French printer: quality of design, integrated security technologies, life expectancy of the bank note and composition. Thomas Savare speaks of a “profound development work on this subject”. More and more complex, Oberthur Fiduciaire's notes are becoming increasingly resilient with life expectancies of up to five years for certain notes. When we know what banknotes go thorugh in our pockets, this speaks of a technological triumph...

Of course, the arsenal used for banknotes, instruments of the sovereignty of a State, are not necessarily transposable or relevant for all products (think of "virtual" goods for example). But the principles of protection inherent in security printing are getting more and more interesting. For example, the security printing industry is sollicited for the security and traceability of tickets for sporting or artistic events: it is a question of securing the various events (better traceability, reading of identification metadata, etc.), but also avoiding resale on the black market or fake tickets.

If there is a lesson to be learned from the experience accumulated by the fiduciary industry - according to Oberthur Fiduciaire - it is that of prevention, that needs to be permanent and systematic: to act upstream, to prevent counterfeiting using technologies or know-how rather than reacting to it. Keep in mind that we only know of those counterfeit goods that are seized. The rest is up to our estimation ... and resignation, for now.

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