Counterfeiting Continues to Roil CPG Brands and Grocers
By John Karolefski
Kadar Dabir Zaid pled guilty to counterfeit coupon-related charges in Lawrenceville, Ga. recently, and was sentenced to 15 years. He was arrested after repeatedly using a high-value counterfeit coupon to download funds to gift cards at a self-checkout in a Walmart store.
This is the latest example of coupon fraud that continues to roil marketers of food and beverage brands and their trading partners.
“Counterfeits are coming hot and heavy,” said Bud Miller, executive director of the Coupon Information Corporation (CIC). “There are continued economic challenges in the country that spur people to doing this. People are always looking for ways to save a dishonest dollar.”
He thanked the law enforcement officers who apprehended Zaid, the Walmart professionals who detected and reported Zaid’s illegal activities, and the CIC members who worked with law enforcement to bring this case to a successful conclusion. “We greatly appreciate your hard work and commitment to enhance the integrity of couponing which benefits the consumers we serve. Walmart’s efforts on this case are an excellent demonstration of how training and dedication can address counterfeit coupon challenges.”
Coupon fraud occurs in several ways:
- When a person intentionally uses a coupon for a product that he or she has not purchased or otherwise fails to satisfy the terms and conditions for redemption
- When a retailer submits coupons for products they have not sold or that were not properly redeemed by a consumer in connection with a retail purchase.
- When coupons are altered/counterfeited.
These activities typically violate Federal, State or local laws. Coupon fraud costs CPG manufacturers hundreds of millions of dollars every year. It also increases costs for consumers and makes it more difficult for honest consumers to use coupons legitimately.
While CIC attempts to list as many counterfeit coupons as possible on its web site, Miller said not all the fake offers in circulation are listed for three reasons:
- It takes time to identify, and to confirm the status of, new counterfeit coupons.
- Some manufacturers may prefer not to have their counterfeit coupons listed.
- The premature disclosure of some counterfeit coupons may jeopardize law enforcement investigations.
The Internet is helping to increase counterfeiting, according to Miller. “People are sharing ideas, concepts and cheating techniques on social media. Companies that run the social media sites are less than cooperative.”
Mill said consumers can protect themselves from counterfeit coupons by never paying money for coupons and avoiding questionable social media groups. He doesn’t recommend downloading and printing coupons form paces other than a manufacturer’s website. Meanwhile, CIC will continue its efforts to work with law enforcement and retailers to bring coupon criminals to justice.
CIC is a not-for-profit association of consumer product manufacturers dedicated to fighting coupon misredemption and fraud. It was founded to encourage integrity in connection with the redemption of manufacturers’ coupons and participation in other promotional programs.
CIC provides education and current information to consumers, best practices to retailers, advocacy for manufacturer members, and resources and support to law enforcement.
CIC leads efforts to reform and improve security practices, enhance transparency, and open communications among all industry participants. CIC’s Annual Summit every March brings leaders from the industry, representing diverse specialties, for proactive discussions on developing issues and trends affecting coupon security.