A newly released consumer protection report revealed just how many bogus luxury items fraudsters attempted to pass to buyers and how a Detroit-based company leveraged tech to bust them.
On the eve of World Anti-Counterfeiting Day, the 19-page document detailed shocking statistics about the volume of imitation sneakers, clogs and clothes sellers tried to pass off. The report came from StockX, a platform that uses dynamic pricing to link sellers and buyers of in-demand goods such as clothing, electronics, sneakers and collectibles.
Here’re the highlights from its 2024 fraud prevention work on products vetted by StockX’s verification processes:
- 370,000 products rejected as inauthentic
- 250,000 pairs of counterfeit sneakers blocked from its marketplace
- $74,000,000 was the value of the denied items
- $10,000,000 was the gross merchandise value of suspected sneaker counterfeits
- 500,000 “bad” asks, or requests, denied to be added to its marketplace
- 90,000 suspicious account creations blocked, preventing a product listing or bid
The document, titled “Brand Protection & Customer Trust Report,” also provided insight into counterfeiting trends. News flash – it’s not just the $3,766 Jordan 1 Retro High Off-White Chicago that fraudsters are faking, StockX reported. The adidas Samba OG Cloud White Core Black retailing for less than $100, gets copied frequently. The trend is indicative of a growing demand for affordable sneakers, the report said.
StockX also reported that its best sellers are the items copied most often. Among the platform’s apparel items, Fear of God is the most popular target. Labubu products from Pop Mart top the most-frequently counterfeited collectible items, and for shoes, it’s Ugg and Crocs Classic Clog Lightning McQueen, StockX reported.
The 2024 findings indicate that there’s been a decline in bad actors seeking admission to its platform. Those aforementioned 500,000 “bad asks” from last year were down from 800,000 in 2023. StockX attributes that decline to what it described as its enhanced fraud-detection features.
StockX’s arsenal of tools to detect fakes include imaging, verification experts and machine learning models – an artificial intelligence application that equips a machine to pull information from data sets and then learn from those details.
The machine learning safeguard gives a risk score to every order. And that score is based on how often a product failed an authentication process in the past and the seller’s behavior. Items with high scores get routed to the company’s most experienced employees for inspection.
The company is also using CAT-Scans to root out fake products. Counterfeiters focus on how a product looks. But the examination of a product’s internal structure reveals if it made using the name brand’s quality construction methods.
For more details about StockX’s work and how it cooperates with law enforcement, you can read the full report here.
