How to Spot a Designer Knockoff

Dec. 18, 2007 — -- Shoppers on the streets of New York have long enjoyed buying knockoff bags, clothing, watches and DVDs. They know what they're getting and they're happy to pay just a few bucks for a fake.

Nowadays though the list of counterfeit products runs longer, and includes less obvious phony items such as perfumes and colognes. As the copies have gotten better and better, spotting a fake has become a science.

It's even more difficult to tell what's real when shopping online, and buyers are being fooled. The U.S. Chamber of Commerce and federal government agencies estimate that counterfeiting deprives the U.S. economy of $200 billion to $250 billion annually.

It's a popular scam, "more profitable than narcotics," according to trademark attorney Harley Iewin.

ABC News bought several supposed designer bags online. One such item was a reported Chanel bag for $650 — a steal at less than half the usual retail price.

Cameron Silver and Christos Garkinos, who own vintage designer shops in Los Angeles, inspected the bags and explained how they could tell the purse wasn't authentic. "Notice how the diamond stitching does not line up. … On a real Chanel bag it would match up."

Next Silver and Garkinos surveyed a supposed Birkin bag that ABC News bought online for $1,400 — the real version would have cost approximately $16,000 from Hermes. "This is not authentic ostrich skin. This really looks like a teenager's terrible acne," they said jokingly.

Shopping exclusively in stores though doesn't mean you're necessarily safe. Sam's Club is settling a class action lawsuit by making refunds to members who bought reported counterfeit Prada items. It also settled a lawsuit by Fendi. Sam's Club tells us it's stopped doing business with the suppliers of those products.

"Good Morning America" contributor and Wall Street Journal editor Mary Bounds recommends sticking to the three P's: price, packaging and place where you buy it.