Counterfeit Shipment of Smoochy, Flash and Bruno Seized

The following article by Graeme Zielinski, Tribune Staff Writer, appeared in the Chicago Tribune March 27, 1998:

When U.S. Customs Service agents a few weeks ago inspected a shipment to O'Hare International Airport that originated in China, they were searching for drugs. What they found instead was Smoochy the Frog, Bruno the dog and Flash the Dolphin. "These are worth a lot more," customs inspector Eddie Gross said, fingering a gimpy rip-off version of Smoochy, a popular Beanie Baby that law enforcement officials said was part of a counterfeit shipment worth a flea market value of almost half a million dollars.

Customs agents on Thursday displayed a small sample of the thousands of counterfeit Beanie Babies it said were part of a larger delivery scheme by two Streamwood couples. "See The appendages on the frog are rather flawed," Gross said, showing a reporter just how bad things were. In an affidavit filed with the U.S. District Court in Chicago, the agents estimated the value of the 8,596 stuffed animals, popular among kids and collectors, at $434,600.

Customs agents claimed the shipment--seized Tuesday at a warehouse in Rolling Meadows--was part of an effort by the two couples, dating back to last year, to distribute the fraudulent knockoffs. Law enforcement officials said many of the bogus babies are resold at some flea markets around the country. Assistant U.S. Atty. Brian Havey said no charges had been filed against the individuals listed in the affidavit, but said the investigation was ongoing. An attorney representing Ty Inc., the Oak Brook manufacturer of the popular stuffed animals, said the bust was one of about a dozen in over the past year involving counterfeit Beanie Babies….

WASHINGTON, Dec. 18 /PRNewswire/ -- Chicago Customs officers at O'Hare Airport have been put on a "Ho-Ho-Ho" alert in anticipation of a very jolly arrival, but first must deal with one humbug of a popular toy seizure.

On Saturday, December 20, U.S. Customs officers at O'Hare will hold a press conference regarding the recent seizure of 456 piratical "Beanie Baby" toys with a retail value of $20,951 and two additional shipment detentions containing over 1,000 possibly counterfeit cute pint-sized pets.

The first shipment, which was claimed to be noncommercial, was seized on December 15 by U.S. Customs officers at the Chicago Customs cargo facility. The fake toys, imported from China, are in violation of a registered copyright of Ty Inc. in Oakbrook, IL. The small collectable violators vary in domestic value; however, the majority of the 456-piece shipment contained a red razorback named "Grunt" who retails at approximately $130 in the Chicago area.

According to U.S. Customs Chicago Port Director Kevin Weeks, "During the Christmas season, Customs officers are on the lookout for counterfeit items that may infringe upon registered trademarks and copyrights in addition to unsafe toys that violate Consumer Product Safety Commission safety regulations, like toys with small parts, leaded paint and toy guns that could be mistaken for the real thing. Overall, Customs reports that in the Chicago area, most importations of holiday toys have been nice rather than naughty."

Date: Sunday, December 21, 1997
Source: By Maria T. Galo, Tribune Staff Writer.
Section: METRO CHICAGO
Parts: 3
Copyright Chicago Tribune

OFFICIALS SEIZE SHIPMENT OF FAKE BEANIES

The 456 Beanie Babies did not look right to U.S. customs officers working at O'Hare International Airport. The eyes, the nose--something about the facial expression on each of the limply stuffed animals was just wrong.
So wrong, in fact, that the agency last week seized a shipment of imported Beanie Baby wannabes at O'Hare.
"These things usually happen in California or New York," said Patrick Noonan, a customs spokesman.
The shipment, which had been labeled "non-commercial," contained mostly faux versions of a red razorback named "Grunt." That particular Baby has a collector's price of about $130 each; other, less expensive Babies also were seized Monday. The total value of the haul was estimated at just under $21,000, according to the Customs Service.
Beanie Babies are tiny stuffed animals that are popular with children and adult toy collectors.
Two subsequent shipments containing a total of about 1,000 purported Beanie Babies have been detained.
On Saturday, the Customs Service briefly displayed the seized Beanie Babies, then whisked them back to the safety of a safe. "We know who the individual is who was supposed to claim these," Noonan said.
The matter is being turned over to the U.S. attorney's office, he said.
One of the red flags waved in front of customs officers inspecting the shipment was the originating country: China. For most Chicago-area residents, this is a no-brainer. Beanie Babies do not come from China; they come from Ty Inc. in Oak Brook.
The same day that the Customs Service seized the fake Beanie Babies, DuPage County authorities had agreed to turn over about 1,200 stolen Beanie Babies to Tribune-owned WGN's Neediest Kids Fund.
Carol Stream police had refused to release the stuffed animals to a Glendale Heights man even though he had been cleared of charges that he stole the Babies.
PHOTO: A U.S. customs officer stands over a shipment of 456 fake Beanie Babies on Saturday.

I am going to try to find the rest of these articles. Some are pretty obsolete :

BEIJING, June 24 (Reuters) - Peking the panda sells in the market stalls of the Chinese capital for just $2.50.

His Beanie Baby animal friends, Seamore the seal and Manny the manatee go for less.

Most are rip-offs -- and that is a problem for Ty Inc, the American maker of the bean-filled cuddly toys that have sparked a collecting craze in the United States. Peking the panda can fetch hundreds of dollars in Los Angeles, Houston or New York.

Copyright protection will be an important part of the trade agenda during President Bill Clinton's visit to China this week.

Nobody will be watching the outcome more closely than the worried executives at Ty Inc.

BOOTLEG BEANIES

The company's clever marketing strategy is built around scarcity value: Beanie Babies are craftily ``retired'' just when Beanie-loving children cannot get enough of them.

That has created a thriving secondary market on which hard-to-find models change hands for many times their price in the shops. Avid collectors swap price information on the Internet.

There are even Beanie Baby auctions.

To keep the craze going, Ty Inc must keep a tight lock on supply. Which is why China, where Beanie Babies are made, is such a problem.

Beanie Babies are snapped up by the bagful at Beijing's outdoor tourist markets. The loveable toys spill from boxes laid out openly on the streets.

More than 100 factories in southern China stitch together Beanie Babies.

According to Ty's lawyers, a few go missing from each shipment that leaves the factory gates.

``Would you be happy if you were paying people to manufacture a product and they were stealing, if they were manufacturing 1000 a day, stealing 10 and selling it on their own?'' asked Ty attorney Jim White.

Rampant theft from legitimate factories, and illegal factories making bootlegs, have plagued the company since last October.

White said 15 to 20 percent of Beanie Babies sold on Beijing streets were the real thing, only stolen. Others were 'seconds', put aside at Ty factories because of flaws. The rest were mostly fakes.

One Beijing vendor said some rip-offs were assembled from genuine parts -- plastic eyes, noses and so on.


SMUGGLING RINGS

Many of the fake Beanie Babies are bought by American tourists, not as presents to take home for a favourite niece or grandchild, but for resale.

American expatriates in Beijing have turned the smuggling of Beanie Babies into a cottage industry.

U.S. Customs officials now routinely conduct Beanie Baby searches of luggage coming off Beijing flights.

``The stuff stopped at customs in the United States often times is genuine product, but it's unauthorized,'' White said from his Chicago office.

All legal Beanie Babies are first shipped to Oakbrook, Illinois, he said. The United States is the main market, although Beanie Babies are sold in many other countries.

There are no legal Beanie Baby sales in China.


BUY THESE OR ELSE

Some fakes are glaringly obvious. Smoochy the frog was spotted recently in a Beijing stall missing one eye and wearing Snip the cat's tag.

Sloppy stitching or an uneven gold rim around the heart-shaped tags are other give-aways. The writing on the tags of some fakes is too dark, washed out or smudged.

But for many tourists, prices are irresistible -- fake or no fake.

``You don't see anything like this in the States,'' marvelled a collector from California as he shopped for the toys in a market near Beijing's diplomatic district. He was carrying a four-page list of requests from his extended family. ``My mother-in-law was, like, buy these or don't come back.''