Discount store bargains come at a price

ASSOCIATED PRESS

Discount stores that scour the world for deals sometimes give shoppers something they didn’t bargain for: bogus products of uncertain origin that may even be dangerous.

A prime example is this week’s finding of toothpaste thought to be both counterfeit and toxic.

Government tests on the toothpaste, bought by federal investigators at Dollar Power discount store in Silver Spring, revealed that it contained diethylene glycol, a chemical found in antifreeze, a Food and Drug Administration spokesman said yesterday. Although the toothpaste was labeled as “Colgate,” Colgate-Palmolive Co. said the imported 5-ounce tubes were falsely packaged.

Watchdogs of counterfeiting said it was an example of how more than CDs, DVDs, handbags and sunglasses are being faked these days.

“This has really become an issue where every industry is affected,” said Caroline Joiner, executive director of the U.S. Chamber of Commerce’s anti-counterfeiting and piracy initiative. The chamber announced a lobbying effort yesterday to step up federal efforts in combating a problem that it estimates costs U.S. companies $250 billion a year in lost sales.

Lately, counterfeit drugs have repeatedly made headlines, even though the FDA concedes they are quite rare in the U.S. drug-distribution system. Worries about fake drugs recently helped sink legislation in the Senate that would have permitted the importation of prescription drugs. When fake drugs do turn up, it’s typically after they have been purchased on the Internet.

Meanwhile, the galaxy of counterfeits continues to expand to include an ever-broader range of consumer products.

“It’s to a point where we see fake auto parts — fake brake pads. We see toothpaste tainted with antifreeze and Underwriters Laboratories tags on electric cords that are fake and catch on fire,” Ms. Joiner said.

In 2006, U.S. agents increased their seizures of counterfeit goods by 83 percent, making more than 14,000 seizures worth at least $155 million, the Homeland Security Department said earlier this year.

Even though many bogus goods, including the toothpaste, have murky origins, signs point to overseas — and China in particular. That country was the source of 81 percent of all phony goods seized in 2006, according to federal statistics.

The recalled toothpaste was labeled as made in South Africa, but its toxic ingredient had been found in Chinese-made toothpastes. Colgate-Palmolive pointed out that the packages it had examined bore several misspellings, including “SOUTH AFRLCA,” suggesting that even the bogus product’s true origin may have been faked.

Its distributor could do little to explain the source of the toothpaste, which it sold at 60 cents to 70 cents a tube to discount stores in New York, New Jersey, Pennsylvania and Maryland.

“We do not make it, we don”t import it, we just buy it from a guy,” said Chris Kim, manager of MS USA Trading Inc., the North Bergen, N.J., company that recalled the 100 cases of suspect toothpaste. A telephone message left for the source identified by Mr. Kim — a man he knows only as “Dialo” — was not immediately returned yesterday.

Discount stores in particular can be vulnerable to fakes, said John Drengenberg, consumer-affairs manager for Underwriters Laboratories. For the past three years, the nonprofit product-safety certification group has helped train the retailers to recognize counterfeits, problematic distributors and which products are prone to fakery.

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