Knock-Off Sales A Terror Threat?

Business Group Claims Terrorists Profit From Counterfeit Goods

(CBS)  No longer just on the streets, counterfeit goods now have a new home in the suburbs where it's move over Tupperware party and make way for the purse party, one of the latest accessories to the booming criminal underworld of counterfeiting, reports CBS News Correspondent Jim Acosta.

The $50 purses being peddled by one woman are knock-offs of high fashion handbags that sell for hundreds if dollars in department stores.

"I can't tell you how many purses I've sold," the woman said. "It's a good way to make some pocket change."

Pocket change that adds up fast: New York police seized $17 million in counterfeits this year, enough to fill 40 tractortrailers.

Detective Tom McFadden says purse parties no longer seem innocent after you follow the money.

"I don't think if a suburban housewife was educated as to what would happen with the money, she wouldn't be partaking in the sale of counterfeits," McFadden said.

"Evidence is piling up fast that counterfeit proceeds are bankrolling some of the world's worst criminals. The buying and selling of cheap knock-offs is far from a victimless crime," he said.

"Now you have a lot of these illicit profits from counterfeiting being funneled into terrorist groups," said lawyer Brian Brokate.

According to a report released by a coalition of U.S. businesses, terrorist groups including al Qaeda, are profiting from counterfeiting operations. The report cites one investigation that uncovered flight manuals for Boeing 767's right next to fake watches, and another raid that found bogus handbags and driver's licenses, along with a list of suspected al Qaeda terrorists.

“There's major harm when a consumer goes on the street and buys a counterfeit product," Brokate said.

Corporate law firms are shutting down thousands of knock-off sales every month on the Internet.

They've even sued the biggest discount stores where the New Balance Shoe Co. has found fakes of its footwear.

"They've counterfeited the box as well," said Ed Haddad of New Balance. “Everything is meant to deceive the consumer to think that they're buying a very high-priced shoe at a bargain price."

In the new world of counterfeiting, markets have changed. Bargains can be had, but investigators warn somebody will pay the price.