Innovative anti-counterfeit solution for safety, brand protection and beyond

The original article published on 27.08.2020, we updated it on 02.08.2023 with new information for better overview of the topic.

A Production of products imitating the brand origin of a manufacturer with misleading labels & packaging, with misleading conscious marketing of those imitation products as originals undermines the legitimacy of a market as such, affects not only the pockets of the original manufacturers, but also often fail to meet the quality and safety standards of the regulated industry.

The industry is enormous – the sales of a total amount of counterfeit goods amounts to US $1.7 trillion – US $ 4.5 trillion , the value of counterfeited products reaching a global estimated value of US $1.82 Trillion, hurting basic human safety and health.

This is an industry that is too large to confidently aim to remove, however, one thing counterfeiting shouldn’t be is ignored. It is estimated that each year, deaths caused by counterfeit products among the G20 economies bear an economic cost of over $18 billion U.S. dollars, with an additional $125 million dollars spent on treating counterfeit product-related injuries. The health and safety threat posed by counterfeit products is real. It is particularly worrying that these parts appear to easily find their way into the supply chain of industries, products of which are in daily use worldwide.

The industries most affected by counterfeiting

Healthcare industry: According to the WHO estimations, 50% of the drugs for sale on the Internet are fake. Especially now, when criminals are trying to cash in on the coronavirus – according to Interpol, the authorities seized around 4.4 million units of illicit pharmaceuticals worldwide. In 2010 WHO reported 8% of all the medical devices in the market to be fake(the actual volume is expected to be even higher). Today, EU conformity certificates aren’t safe either, according to OLAF millions of substandard medical products have been caught in multiple Member States. This just makes the point stronger that the problem cannot be ignored.

Automotive:

According to Fujitsu, the most common counterfeited automotive parts are brake shoes, brake pads, steering linkages, air filters, spark plugs, wipers, airbags and other interior accessories. Moreover, businesses in the sector are continuously being penalized for illegally marketing and selling refrigerant hydrocarbon products (i.e., ES 22a as a replacement for R-22), as well. According to the EPA, the use of ES 22a – a refrigerant meant for window air conditioning units – creates the potential for explosion and fires, it is a serious risk to human health and the environment. Safety is definitely compromised with the low quality of such fakes.

Aerospace:

Aerospace and defense products are generally designed to serve in longer life cycles than most similar productions(i.e. automotive). The B-52 aircraft, for example, has an anticipated retirement date as 2040, even though it is in service since February 1955: Therefore, sometimes to service aerospace and defense products, there are used parts that may no longer be available (authorized aftermarket manufacturer, distributors or resellers no longer hold those parts). This creates a rabbit hole, from which the counterfeiter takes advantage of. Surely, it is not as widely spread as for example, counterfeiting in the industry of clothing, but the human safety toll is much higher.

Other industries and products with high potential of health risks:

• Counterfeit lithium-ion laptop batteries -extreme heat, self-igniting, and exploding,
• Counterfeit helmets and baby carriers – breaking easily,
• Counterfeit cosmetics – severe skin reactions,
• And surely the plastic toys – Customs officers from four EU frontier countries checked 2.26 million Chinese, blocked 722,598 from entering Europe after discovering illegal levels of phthalates and destroyed 31,590

Not only does counterfeiting include health risks, but also it contains severe economic damage from end-users all the way to the whole industry. The ICC, for example, has estimated the global economic value of counterfeiting to reach $4.2 trillion and put 5.4 million jobs at risk by 2022.
The intellectual property, of course, is known as one of the main targets of the counterfeiters – the high-end luxury goods market came up to US$ 236 billion in 2009. The steady market growth over the last 20 years, no direct harm to health, and of course the growth of counterfeiting solutions – makes it easier and easier to fake the luxury goods, stretching the annual loss from these products to US$ 12 billion.

Anti-counterfeit solutions in 2020

For centuries there have been various regulations set in the justice systems of different local and global economic territories in the world to fight counterfeit. The private sector, too, tried to get one step ahead by coming up with different anti-counterfeiting technologies and innovative solutions throughout the years. Most of those technologies, unfortunately, have become outdated or outsmarted in 2020:

• Holograms – do not capture any data, cannot be tracked, fairly easy to fake.
• Digital Watermarks – one of the most advanced solutions, however not very affordable or effective for many industries and goods(i.e., luxury goods, refrigerants, etc.), cannot be tracked
• Tamper-Proof Packaging – inexpensive design, limited vulnerability testing,
• Optically Variable Device/Features – not completely immune to being copied(i.g. Counterfeit currencies), cannot be tracked, not entirely efficient for most end-use products.
• RFID – one of the most progressive technologies available for anti-counterfeit packaging today. The RFID technology truly solves a lot of the problems the market was facing and has many added values over multiple other technologies, however, with all the pros this technology too has some strong cons.
  • Security: Unfortunately, to hack the system is not a big obstacle for the criminals
  • Privacy: too much tracking can never be safe, the technology has the risk to compromise consumer privacy
  • Fragile: rather easy to damage the tag, and once damaged – cannot be tracked
  • Data accuracy: the nature of the technology can bring up environmentally-caused issues(i.e. The ability of some RFID tags to be read can be affected by proximity to some metals or liquids, which can lead to missed shipment information).
  • Reputation: the above mentioned and other potential hazards have damaged the reputation of RFID technology.

The market is exigent on an innovative solution that would include the benefits the current technologies give, at the same time solving the shortcomings of those.

RVmagnetics introduces unique Identification Tags (ID tags):

A MicroWire of specially designed and identified chemical composition, length and positioning on a Product or a Part will be detected and IDed with a sensing system also designed and developed by RVagnetics. RVmagnetics is the sole-manufacturer of these MicroWire sensors, thus a certain ID tag will be unique and exclusive for a certain Product or Part. To ID a part which is equipped with a MicroWire can have the following applications:

• Tooling: choosing the correct tools, the correct components for the tools (r.g. Tooling Head) is a crucial starting point, which, if failed, not only can cause reduced efficiency and doing the same work in more time – but also might damage highly important materials, and thus also whole manufacturing processes. Thi is true for the Aerospace, Automotive, Oil& Gas, Medical Devices, Electronics, Construction & Woodworking, Mining & Heavy machinery Industries.
• Wear & Tear: often it can be necessary to Identify not only if the MicroWire is on / in the material, but also whether the MicroWire has been damaged, or completely destroyed. In fact one sensing head of RVmagnetics can detect few MicroWires at once, and as the manufacturing cost of ID-specific MicroWires is fairly inexpensive, an application can “afford” to have on or more MicroWires being damaged or destroyed due to wearing – and once a contactless sensing head of RVmagnetics stops receiving a binary readout from the damaged wire – we can immediately identify the “first layer of wearing” on a material (more on this topic soon; contact us for specifics)
• Sorting / Packaging: having a certain type of MicroWire customized for a certain version of a product can save valuable time and resources for warehousing, retail, shipping and other logistical operations. Even though there are existing solutions for this (e.g. RFIDs), a MicroWire sensor is lighter, resistant to harsh environmental conditions, and due to the unique data captured from a wire – it can help explore the printless / label-free logistics of packages even more. Moreover, a MicroWire ID tag can add an additional feature of lightweight, contactless detection of packaging damage (bending, position changes, shocks) on packages of high importance.

Moreover, a combination of multiple MicroWire sensors of arbitrary quantity, lengths, order, and metallic composition, diameters which creates a Matrix of independent unique codes, thus, the hardware is fundamentally impossible to copy or hack. In other words, the ID tags are completely unique subjects,

• Inducing different frequencies in the vicinity of the tag results in a different response (code) from the tag, that can be read with a reading/inspection device.
• The ID tags distinguish between original and false products. They can be embedded into almost any material – textile, paper, plastic, etc. they can be directly incorporated into goods, their labels, or in the coatings during the manufacturing process.
• do not cause any materials defects and do not require any electrical power supply nor add any weight
• the tags are fairly inexpensive. Unknown to the counterfeit market. In terms of software, the storage of the codes involves a blockchain technology that is responsible for the software security.

This is essentially applicable for products, parts and materials of luxury sectors, exceptional exclusivity and quality.

The fight against counterfeit products is a global challenge with companies across industries implementing tools to create a robust supply chain. Yet, everyday counterfeit goods worth millions of dollars enter the supply chain and reach. This not only leads to risking basic human safety and loss of revenue, but it also ends up hurting the brand image from stealing intellectual property. Our goal is to ensure end-user safety and help our clients fight counterfeit effectively.