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Product Diversion and Parallel Importation Investigations

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You’re walking down a busy city street. An enthusiastic but slightly shady salesperson is suddenly before you, selling handbags or watches. The prices are far too low for the items to be the real deal. But then you look more closely. Are they counterfeit or the genuine article? Product diversion and parallel importation crimes have made it possible for someone on the receiving end of a distribution network to make a profit from non-counterfeit products. While the items themselves might not be a rip-off, and the price is oh-so-right, this underhanded behavior can be detrimental to a company’s reputation and, of course, their bottom line.

Where Does Product Diversion Occur?

Product diversion and parallel importation most commonly occur among export sales, especially for software, pharmaceuticals, and luxury goods like designer handbags. Diverters, unauthorized online retailers, and storefront owners often target companies they believe will offer them little resistance when they scoop up the product from a company’s shipment.

Another common area of product diversion is when those in receipt of bulk shipments neglect to carry out instructions to destroy excess merchandise. Some employees or third parties will take leftover goods and profit from them on their own while the parent company is under the impression that the items were eliminated, donated, or otherwise handled as instructed.

International trade, intellectual property, and simple theft can all factor into cases of parallel importation. Don’t allow your company to be vulnerable to parallel importation. If you suspect product diversion within your company or in the import-export company with which your business is aligned, it is possible to prove that a breach in the distribution chain has occurred. A highly trained private investigator will gather the documentation, eyewitness accounts, and undercover research that offer proof of grey product.

Are you a victim of product diversion or parallel importation? Call us today! We can get you proof.

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The Online Crime of Parallel Importation

You’ve searched online for that sold-out toy your kid desperately wants, or the bedspread you’ve long been coveting. While major retailers may not come up in your shopping search results (at least not at a desirable price), there does pop up one promising unknown retailer. They’re selling your coveted item for $50 under retail price! Can it be true? Should you take a chance on an unfamiliar seller? While the rewards may be great, the goods being purchased were very likely acquired fraudulently.

If your company’s goods are showing up on eBay or Amazon stores and are advertised as being available in large quantities, somewhere along the way a shipment was intercepted or rerouted to benefit anyone but your company. These unauthorized sales negatively impact revenue, of course. One of the biggest problems, however, comes when illegitimate sales make it difficult to attract legitimate distributors and retailers. When reputable sellers see that your company seems to tolerate unauthorized sales channels, they will be less willing to compete in the same environment.

Don’t believe anyone who tells you that nothing can be done about the unauthorized acquisition and sale of your goods. A qualified private investigator is trained to discreetly uncover your parallel importation problem through various means. Costly tracking solutions could lead you on a wild goose chase, but dedicated product diversion investigators know what paper trails to follow and which are simply serving as red herrings. From contracts to bills of sale, shipping orders to warehouse receipts, the telling evidence exists for those who know where to look.

Private Investigations for New Import-Export Relationships

Illegal operations in the import-export business are, unfortunately, common. Products don’t always reach their intended destination. Some parallel importation is made possible due to innocent user error. But there are many cases where someone within your organization has made the product diversion possible. And then there are items that end up being deliberately transferred to third-world markets for a double profit on the receiving end of a shipment because of a dishonest outsourced import-export partner.

Along with identifying the culprits in a parallel importation case, private product diversion investigators are also called upon to vet companies being considered as import-export partners. Working within an international marketplace takes a great deal of trust. Foreign distributors may promise you one type of service but provide something completely different (and far more beneficial to themselves). Knowing ahead of time what kind of business relationship you are potentially entering into – and whether the company you’re in talks with is legitimate or has a history of parallel goods or counterfeiting activity – will ultimately save you trouble, grief, and lost revenue.

Import/Export relationships in product diversion and parallel importation
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Why Hire ASG to Conduct Product Diversion and Parallel Importation Investigations?

ASG product diversion and parallel importation investigators are thoroughly trained and prepared to conduct the necessary searches and undercover operations to uncover product diversion happening within your business. Each parallel importation investigation is customized to uncover the deception occurring within or in association with your company.

Contact ASG if you suspect product diversion is occurring at your company or with your import-export partners.


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