Counterfeit trial highlights dangers of grey market

Three people have been charged with handling stolen goods, following the recovery of Microsoft Certificates of Authenticity (COAs) which were taken from a Scottish manufacturing plant.

Three people have been charged with handling stolen goods, following the recovery of Microsoft Certificates of Authenticity (COAs) which were taken from a Scottish manufacturing plant.

Zafor Ahmed, Sikander Qureshi and Shaheen Parveen, all from London, appeared at South Thames Magistrates' Court last December. Parveen was remanded in custody in Holloway Prison. The case is expected to go to trial next year, officials said last week.

During the arrest about £3m worth of counterfeit copies of Windows NT, Windows 98, Publisher and Frontpage, as well as £6000 cash, were recovered. The copies are believed to have been produced in the Far East.

The stolen COAs are from the Thompson Litho plant, an East Kilbride Authorised Replicator for Microsoft's original equipment manufacturer division, which was the victim of a burglary in July 1998.

During the raid, 115,000 software authentication manual covers were taken, estimated to be worth up to £12m when built into products. Microsoft has since improved the security features of its products. The company's CD-Roms contain a holographic image and incorporate Bios locking, making them more difficult to copy.

In the meantime, vendor Epson has withdrawn 2000 counterfeit ink cartridges worth £111,000. The company traced the cartridges to Eastbourne supplier Fender Group, which said it had bought them in good faith from the so-called grey market. Cartridges were also surrendered by Globus Office World.

Working with Leicester trading standards, Epson followed the supply chain back to Global Knitting Machines, which had imported the products from China. Global Knitting Machines also said it did not know the cartridges were counterfeit, although they were cheaper than genuine cartridges.

David Brush, UK legal director at Epson, said: "Dealers cannot hope to spot the fakes which look very convincing and which may be mixed in with genuine product. Grey business is risky business."