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Last Updated: Thursday, 17 July, 2003, 13:19 GMT 14:19 UK
Fake goods linked to terrorism
US dollars
Fake goods: "As profitable as drugs and with lesser penalties"
Pirated DVDs, fake designer handbags and counterfeit cigarettes could be putting bullets in the guns of terrorists, the head of Interpol has suggested.

Interpol Secretary General Ronald K Noble warned that militants were increasingly turning to counterfeit goods to finance their operations.

The global annual trade in counterfeit goods is between $400bn and $450bn, he told the US House Committee on International Relations.

Without giving any estimate of how much militant groups were actually making, he cited examples ranging from Northern Ireland to Chechnya.

Mr Noble suggested the counterfeit trade was as lucrative as drug-peddling and he predicted the link between militants and fake goods would grow.

According to one estimate, the Interpol head noted, there is a return of 10 euros for each one euro invested in counterfeiting.

Less risk

Mr Noble also drew attention to the relatively light penalties counterfeiters face in many countries.

"In France, selling counterfeit products is punishable by a two-year prison term and a 150,000 euro fine while selling drugs is punishable by a 10-year prison term and a 7,500,000 euro fine," he said.

The Interpol secretary general said some militant groups dealt directly in counterfeit goods, such as paramilitaries trading cigarettes in Northern Ireland.

Others, such as groups in the Middle East, received income indirectly from sympathisers involved in the illegal trade.

Among examples quoted by Mr Noble were:

  • A scheme unmasked by Russian police in 2000 in which Chechen organised criminals ran a pirate CD factory which sent funds to separatist rebels. The factory's average monthly earnings were put at $500,000 - $700,000

  • A "long-standing relationship" between criminal organisations in Kosovo and ethnic Albanian militants, deriving profit from a widespread trade in pirated consumer goods

  • Suspected funding for Lebanon's Hezbollah militant group by Lebanese expatriates in South America who used free trade zones there to trade in counterfeit goods

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