Flea Market Fakes: 'GMA' Goes Undercover at N.C. Sting of Counterfeit Merchandise

March 16, 2011 — -- That designer flea market bargain you thought you were getting is probably a fake and possibly dangerous.

Counterfeits have existed in New York City for years, but now they're being found in the suburbs and small towns of America.

"GMA" went undercover with authorities in North Carolina for an exclusive investigation.

Click HERE for tips on how you can spot a fake.

Purses, shoes and DVDs are still the most common counterfeits, but investigators are seeing more sinister fakes, too – like electric cords that easily catch fire, contaminated cosmetics, even fake prescription medicines. Now, some states are taking incredibly aggressive steps to stop them.

The North Carolina Secretary of State's office gathered police officers from across the state to launch Operation Faux Pas, a sting operation designed to nab suspected counterfeiters at a local flea market.

During a police briefing, Sgt. Henry King of the Rocky Mount Police Department explained the plan. "Around this area right here is where the DVDs, shoes and pocketbooks are going to be."

Officers have to catch vendors actually selling the fakes to press charges, so four undercover teams attend the flea market first.

"Sgt. King's team is going to make a buy - they're going to have the vendor under surveillance," said John Lynch, Special Agent in Charge with the North Carolina Secretary of State's office.

Why so aggressive? Because of one woman, Secretary of State Elaine Marshall.

"If we can make it, somebody can fake it," she said.

Marshall's office runs the most intense anti-counterfeiting operation in the country. They've seized more than $12 million worth of fakes in the past year alone.

Marshall says this is a global issue.

"It absolutely is. Organized crime has found that we as Americans, think it's funny to buy something that we clearly know is a knock-off," she said. "And we don't think any further than that. We don't understand-how did it get here? Who made it? Where is this cash money going?"

You can buy fake products at a fraction of the price, but at what cost? Marshall says some are dangerous, others made by child labor. Plus, North Carolina has seized illegal drugs and weapons that were shipped alongside the counterfeits.