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8 June 2022Sarah Speight

Interview: Andrew Masterson, PIPCU

Deliberate consumption of counterfeit goods is rising among young Europeans, according to a new survey from the European Union Intellectual Property Office. Some 37% of people aged between 15 and 24 deliberately bought fake products in the last 12 months—up from 14% in 2019.

While the results show that deliberate online piracy stabilised, at 21% of those surveyed, piracy—along with counterfeit goods—remains a problem, not just in Europe but worldwide.

Detective sergeant Andrew Masterson is part of the UK police department tackling these very issues, many of which extend beyond the country’s borders. For World Anti-Counterfeiting Day, WIPR spoke to him to find out what he does, how he got there and why it’s a job he loves.

Wake-up call

Prior to joining PIPCU, Masterson’s knowledge of IP infringement and counterfeit goods was like any layperson’s—“probably very superficial,” he admits.

But he soon realised the breadth of the problem, as well as the impact on industry. “It was shocking. That was a real wake-up call for me.”

PIPCU, part of the City of London Police (CLP), was formed in 2013 to tackle the growing problem of counterfeit goods and online piracy. Funded by the UK Intellectual Property Office (IPO), the team comprises 26 detectives and civilian investigators and works with a sister unit in the northwest.

Masterson’s role was created to oversee the online and physical disruption of IP crime and engage with stakeholders, such as companies and brands.

So far, PIPCU has been involved in 436 investigations, with 121 live investigations at the time of writing. As of March 2022, PIPCU has “disrupted” £719 million worth of IP crime since its inception.

Masterson attributes this success to intelligence sharing partnerships with various trade bodies and law enforcement agencies, including the International Trademark Association, UK Border Force and Europol, the IPO, the New York District Attorney’s Office, and Homeland Security, as well as music companies, film distributors, software designers and brands.

These relationships are crucial, he says, “otherwise, we're at a disadvantage trying to catch up with the criminals all the time, as they find a new way to transport goods or change them”.

Pandemic role

Working in PIPCU, says Masterson, was a new challenge. He joined the CLP in 2010 as a constable, and pursued the detective route before being promoted to sergeant and working in the fraud department.

From there he joined PIPCU. “For me, it's a really interesting job dealing with something very different. I really like it because it fits well with who I am, what I like to do,” he says.

But just as he was finding his feet, the pandemic hit. PIPCU was deployed with the fire brigade to assist the NHS to deal with COVID deaths in residential homes and ensure that safety protocols were followed. This experience, he says, is a prime example of how the unit is so adaptable.

“The officers that form PIPCU have that real aptitude for balance and change. We switched quite quickly from IP crime to public safety.” This, he says, included dealing with investigations where people were selling counterfeit PPE and fake vaccines.

During COVID, however, IP crime didn’t go away. In 2020 there were 130 billion visits to online piracy sites, with 65 billion of those visits accounting for pirated TV content, according to a report by MUSO. Visits to film piracy sites alone rose by 33% globally in a year since February 2020.

“As everyone was at home, Netflix and their usual subscriptions weren't cutting it,” says Masterson. “So we saw that increase in piracy, which then had an impact on our stakeholders around the world, such as the movie and music industries, seeing that big spike and then coming back to us and asking what we're doing about it.”

And the restrictions of the pandemic changed how the unit worked on IP during this time; instead of door-knocks, PIPCU had to disrupt piracy activities and operations online. Since its inception in 2013 the unit has shut down 120,000 counterfeit websites via Operation Ashiko.

Ahead of the game

With rapid advances in technology, PIPCU has to be one step ahead. “We have to preempt the new and emerging trends and how we get ahead of them,” he explains.

For example, when the team works out ways to disrupt illegal websites, criminals will revert to previous tactics, or adapt by changing the location of a domain. And while similar counterfeit products were once advertised online, there are now more covert tactics at play, such as using social media.

The unit creates an infringing website list, which currently holds about 1,500 websites. This is shared among advertising companies, organisations, schools, colleges, universities, and internet service providers, which can then block those sites or the adverts appearing on their sites.

The ease with which the unit can engage with the local law enforcement in different jurisdictions varies, depending on how “friendly” those countries are.

“There are some countries which I won't name, but I'm sure you can imagine. Even if we had High Court orders to get things shut down, they're not going to engage with us because of political reasons, because they are a haven for particular crime types. So we look at new ways of doing things,” says Masterson.

One successful tactic used by PIPCU is Operation Creative, which was set up in 2017 to tackle illegal advertising of gambling sites. Masterson explains that for those sites not based in the UK, where IP laws are slightly different, it’s not so easy to target the data rooms or service centres. Instead, in Operation Creative, PIPCU targeted the advertising revenue.

Using this strategy, he says, “we can cut those funding streams almost down to zero within 30 days of [a site] being referred to us…those sites then become redundant within quite a short space of time”.

And, he adds, it’s down to algorithms. “Advertising companies and internet services don't place adverts individually, they have algorithms that depend on what service the advertiser pays for and which consumers they’re looking to target.”

The team then engages with those advertisers and site owners, which respond by taking the advertising down.

Cease-and-desist strategy

Dealing with the spectrum of IP crime is a question of proportion, explains Masterson.

“When a referral comes in, there's a number of ways we can take action. If it’s an organised crime group, or there is high value, high volume or high risk to the public, we're probably going to look at what you consider classic policing tactics. We'll be doing warrants, arresting people, seizing the product en masse, and looking to prosecute.”

At the other end of the scale, the unit uses a cease-and-desist strategy—a much more effective tactic for low-value, low-volume, hard-goods activities that do not present a high risk to the public. The problem is that selling counterfeit goods has become much easier with the rise of the internet.

“What the internet has allowed us to do is have a pair of fake trainers in your house, put a picture online and sell them to someone who lives in Dundee without ever having to leave the house except to post them,” he says.

But PIPCU’s tactic for crimes such as these is to disrupt the activity. “Is it proportionate for a policing unit to crash through my door at six o'clock in the morning, arrest me, interview me and threaten me with court, where ultimately the courts are delayed because of COVID and they're busy? And what is the likely outcome of that? Probably no punishment, maybe a small fine.”

Masterson cites the example of a cease-and-desist visit to a single mother who had started selling a fake goods.

His team knocked on her door and explained that she could sign the goods over to be destroyed, that it would be the end of the matter with no criminal record.

But what initially looked like a small operation was actually a larger-scale business being run from her garden shed. “It was like a production line: at one end was unbranded products, in the middle was badges, brands, etc. And at the other end was product packed up ready to go.”

They stopped the cease-and-desist process and the offender was arrested. “We spent the rest of the day seizing all this stuff. It was a good result. But you don't expect it when you're just trying to do door knocks and talk to people.

“She said, ‘if you'd come to me a year ago, after I sold the first pair of trainers, I would have been embarrassed and I would have stopped’. And that really resonated for me, that's what I want to do with this project…get to people early, speak to them and say what they’ve done is illegal, but if you stop now, that's the end of it.”

In the end she was given a caution. “If we can disrupt the criminality, that is a positive outcome for us as much as looking at a more serious case we might take to court.”

Wider impact

The impact of counterfeit and piracy crime is often invisible, though. Just before COVID, Masterson attended conferences where he heard from directors of the film and music industries and realised the extent of the impact on those industries.

He explains that mid-range films suffer most from piracy, citing one of his favourite films that falls into that category—Waterworld. “If that script landed on someone's desk today, it wouldn't be made, it would cost too much to make,” he explains. “And there's a risk, if it's pirated, that it won't make a return.

“And then the knock-on from that is the people that build the studios, run the locations, do the catering etc, go out of business. It's not the studios or the actors that lose out, it's the periphery that lose and the budding directors, sound technicians or set designers.”

And there is a darker side to what lays behind most larger operations.

“You have to be aware that people who generally release [pirated content] are criminals in some form or another. And that is funding a number of different other crimes—it's very rare that we find someone just committing mid to high-level counterfeiting or piracy.

“They're linked into organised crime groups, which are a link to modern-day slavery, terrorism, drug dealing, people trafficking. It's an easy funding stream for those already highly dangerous activities, sadly.”

For Masterson, a big part of the unit’s purpose is educating the public around why counterfeits are dangerous.

“There's a bigger harm behind it, not just to individuals but to those making it and importing it,” says Masterson.

He adds: “Some people don't know that our team exists. And when you explain what we do and what IP crime is…when you start just briefly explaining the wider impact to the economy, the individuals that buy it, etc, then it does get some traction. And we're really seeing that change.”

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