Episode 3 Fake Britain

Welcome to a world where nothing is quite as it seems.

Welcome to Fake Britain.

SHOUTING

SHOUTING

Put your hands behind your back now!

Here at the Fake Britain house,

we'll reveal the fakes that are flooding the market.

Conning people like you and me and making money for the criminals.

We'll investigate the fraudsters

who are selling us something that isn't real and could be dangerous.

And we'll help you avoid falling for a fake.

Today on Fake Britain...

The movie has won the hearts of children across the world

but the fake merchandise has left one little girl scarred for life.

The blood was absolutely flowing out of her face.

The fake hi-tech coat that could have chilling consequences.

If a consumer was counting on a jacket for their survival

and they bought a counterfeit jacket,

that could result in a life-and-death situation.

And the fraudsters trying to steal millions

from taxpayers and charities.

It makes you intensely angry that somebody could come

and take money away from hard-working people.

Even if you don't have young children,

you can't have escaped the phenomenon that is the Disney blockbuster,

Frozen.

It quickly became the highest-grossing animated film

of all time and demand for the merchandise has been huge -

with toys, dolls, games and much more flying off the shelves.

They just can't make it fast enough.

Little wonder then that the fakers have grabbed their slice

of the Frozen pie.

But the consequences for some kids have been truly shocking.

Frozen tells the story of Princess Elsa

who turns everything she touches to ice and snow,

-and her little sister, Anna...

-Really?

-..who sets out to save her.

That's my sister.

Kids who adored the film went even crazier for the merchandise,

with dresses, dolls and soft toys all selling out at Christmas time.

Parents who couldn't get their hands on the toys in the shops

quickly turned to the internet, where the fakers were only too happy

to fill the demand.

But give these fakes to a child and their smiles may turn to tears.

One dad with a Frozen-mad daughter is Stuart Broll,

from Stockton-on-Tees.

My daughter Lydia is pretty much obsessed with Frozen,

like most girls are these days.

She loves it.

Like any loving dad,

Stuart wanted to make his daughter's dreams come true.

So, he bought her some Frozen toys.

I'd been looking online one night, looked on eBay

and they've got a massive selection of Frozen products.

Stuart chose a watch with a bendy metal strap

that would wrap around his daughter's slim wrist.

Known as slap or snap bands,

these accessories come in a wide range of designs

and are popular with children,

who enjoy slapping them round their wrists.

Lydia is quite small and I did have trouble, obviously,

getting a watch to fit her.

So, I thought with it being a snap band,

it would be the best alternative.

It would actually fit round her hand neat and tidy

and it wouldn't fall off.

Stuart also bought a stuffed toy in the shape of Sven the reindeer,

one of the characters from Frozen.

But when the toys arrived, Stuart made an appalling discovery.

On inspection, I found that the metal legs inside

was actually sticking through the outer covering of the animal.

I couldn't even think about the damage that

could have done.

I mean, it's horrific.

You know, it's a metal rod that's sticking through.

The amount of damage that could have caused,

it's not even worth thinking about to be quite honest.

The slap watch was equally deadly.

Sadly, on inspection and cutting it open,

I found a metal tape measure to be used inside.

Shockingly, the wristband was simply made

from a standard builder's measuring tape

that had been cut to the right shape and covered with cheap plastic.

It is absolutely razor-sharp down the sides

and also at the corners where it's actually been cut down.

Thankfully, Stuart managed to spot the danger

and remove the toys before Lydia was hurt.

I'm absolutely disgusted that people are actually selling these products

in the first place.

That could potentially harm or even kill a child.

But one father who wasn't so lucky is Nathan Stodden from Cornwall.

Nathan's dad to three girls - Chelsea, Bethany and Madison.

Like other girls their age, they too are fanatical about Frozen.

When six-year-old Bethany and three-year-old Madison

were invited to a friend's Frozen-themed birthday party

one Saturday afternoon, they were delighted.

After the event, both girls were given a party bag

containing a Frozen slap wristband.

They absolutely loved them.

As soon as Bethany had the wristband, yeah,

it was on and she's slapping away and playing with it. Weren't you?

Bethany loved the wristband so much she didn't take it off

and was still wearing it the next morning.

Then I was in the kitchen doing the dishes.

The kids were upstairs playing and bouncing around.

And I heard a massive scream from upstairs.

Nathan was about to be confronted with a shocking sight.

Bethany had come walking into the kitchen with footprints of blood.

Blood dripping down her face with a massive open wound,

which was very, very deep and wide.

It was like something out of a horror movie.

Literally, it was just a trail of disaster.

Poor little Bethany had caught her face on the edge

of the fake wristband, causing an inch-long cut in her cheek.

Bethany was in hysterics when she came in to me

and I was in a massive state of shock from looking at it.

You know, my beautiful daughter had a massive gash on her face,

which frightened me.

When Nathan examined the wristband,

he discovered that just like Stuart's,

it contained a cut up tape measure.

This is the one that actually did the damage itself.

This is absolutely razor-sharp.

It actually entered Bethany's face

to just below where my thumb is now.

That's how deep it actually went into her face,

which is nearly 10mm.

Bethany was rushed to hospital, where the doctors were able

to stop the bleeding and close the wound.

But she may be scarred for life.

It really hurted.

And how do you feel now?

-Scared.

-It's sad, isn't it?

You don't like seeing the scar on your face, do you?

Even after what has happened, Nathan still believes

they've been very lucky.

If it had slashed her wrist or caught an artery

or anything like that, the doctors would have really struggled.

And certainly within the time it took me

to take her to my local hospital,

she would have lost a serious amount of blood.

But it's not just the occasional slap band or stuffed toy

slipping through.

Faking Frozen products is a boom industry.

Huge container-loads of fake Disney merchandise

have been secretly arriving at British ports

and no-one knows how much of it has found its way into people's homes.

It's Trading Standards' job to try and stop the deluge.

And in Nottinghamshire, one team has successfully intercepted a huge haul

of fake Frozen merchandise,

which was being sold from a shop in their area.

It was just everywhere and all tat.

Paul Gretton and Robert Martinez were part of the team

that seized the toys.

They're an obvious fake because on the back...

..you've got the impression of buttons but no actual buttons.

And there's no screw for the battery compartment as well.

So, the batteries would be accessible to little kids.

Delightful little thing(!)

What's really surprised me -

and I've been in Trading Standards a long time -

is the really poor quality of some of this.

Ooh, the leg's come off.

This is some of the worst fake stuff I've seen in 30 years.

It's not robust enough to be given to children.

It's really, really shockingly poor stuff.

In total, they've seized over 700 items, including umbrellas,

wallets, bags, alarm clocks and much more.

What is a little bit unusual is

fake product normally sells for less than the market value.

But the demand is so high for this particular product

that it's actually selling at market value,

what the real stuff is selling for.

As well as being poor quality,

many of the toys are potentially dangerous.

Of serious concern are hooded coats

with chords that could strangle.

They're really nasty.

You know, I thought we'd seen the back of this sort of thing,

I really did.

The problem with that is, if that gets caught -

and the classic one is when they're coming down a slide

in a playground - and pulls, it actually forms a noose.

And there were deaths.

Two to three deaths a year before the law was changed on that

some years ago.

So, that's the real worry with those.

Children's coats with drawstrings that pull all the way through

are now banned in the UK.

Coats for children under seven

aren't even allowed to have decorative cords.

I don't think I'm exaggerating by saying that

the worst that could happen with some of this product

is there could be a fatality.

And Nottinghamshire County Council's Trading Standards aren't alone.

Enforcement agencies have been seizing goods

up and down the country.

At the port of Dover, a lorry-load of fake toys,

including nearly 500 fake Frozen dolls,

was impounded in the run-up to Christmas 2014.

Meanwhile, at Stansted Airport, dolls and accessories worth over £8,000

were confiscated from shipments arriving from Malaysia and China.

For the Stodden family,

their encounter with a fake Frozen toy

is an experience they're never going to be able to forget.

I think the difficult thing for ourselves is the childhood years of,

certainly school photos, are going to be haunted by

such a horrible scar on such a beautiful girl's face.

It's...

It's quite...it's quite emotional, isn't it? Hm?

When you buy a coat to keep you warm, well, you want it to keep you warm.

A parka filled with goose down is amongst the very warmest there is -

as this one should be.

But it's a fake.

Buy a real down coat and you'll be toasty.

Buy a fake, you'll be left out in the cold.

Down-filled parkas were designed for those working

in the very coldest conditions.

But they're now a regular sight on our high streets during winter.

One brand of down-filled coat is called Canada Goose.

Kevin Spreekmeester is Chief Marketing Officer.

Canada Goose is a nearly 60-year-old company

that manufactures some of the world's best down outerwear.

The company makes coats for anyone who wants to stay warm -

from shoppers out and about on a frosty day,

to rugged outdoor workers in the coldest places on earth.

We make warm jackets for the city.

We make warm jackets for athletes and dog mushers

and researchers in Antarctica.

For these people, it's a tool of their trade.

It's equipment. It's necessary. It's a survival piece.

Of course, you don't have to be an Arctic researcher to wear one

of these coats.

In fact, they're now regularly worn as winter outerwear

in towns and cities.

But the manufacturers say they're still designed to withstand

the most extreme temperatures.

We continually study jackets in cold chambers.

We continually look for improvements in fabrications and trims.

It's an ongoing process.

Of course, the fakers have spotted the chance to profit

from the company's success.

They are making coats that look like exact replicas

of their high-end designs but with none of the technical wizardry.

And for outdoor workers relying on their gear to protect them

from the elements, that could have serious consequences.

As Maya Plass found out.

-Come here.

-Maya is a marine biologist who spends her days

battling the weather around Britain's coastline.

I'm often outside so I spend a lot of time

just exploring the coastline,

whether it's doing rock pool rambles with children,

or whether it's diving as well and spending a lot of time on the water.

After a particularly cold day out on the boat,

Maya decided it was time to buy a new warm jacket.

Spotting a French website that had the coats on sale,

she jumped at the chance to grab a bargain.

And I knew friends that had had Canada Goose coats

and completely relied on them, even going on polar expeditions

and things as well.

So, I just felt that I couldn't lose the opportunity

of staying lovely and warm and dry for very cold, wet days

out on the sea.

Maya ordered a parka and a gilet, both on sale at a hefty discount.

But when the coats arrived,

her hopes of staying warm and dry were dashed.

As soon as I got them out of the parcel,

the coat material just didn't feel quality.

It felt very cheap.

It felt like it wasn't going to be waterproof

and I knew that they were fakes.

The fake parka had none of the top-quality insulating features

that Maya was expecting.

You can see from some of the stitching here

that there's stitches loose.

That the material's really poor quality and isn't waterproof.

If I just get some water and just drop it on the top.

And if it's a really good waterproof coat, the water beads will stay.

But you can see already by leaving it on there,

it's completely soaked in.

There are problems with the fit too.

Not a very good hood.

SHE LAUGHS

Maya kicked herself for having been taken in by the fakers.

So, when I realised they were fake, I was genuinely really disappointed

cos I'd wasted my money.

I also felt a bit of an idiot.

I thought, "How could I have done something so stupid?"

But I realise that anyone can do it as well.

So, if you've bought one online,

how can you tell if you've been fooled?

So, what we have here is an authentic jacket.

And here we have a fake jacket.

The most obvious thing is the overall appearance

of the jackets.

This is our Arctic Tech fabric, which is a polycotton blend.

It's smart. It's covered in DWR, which is a water resistancy.

It doesn't crinkle like this one.

And, if you take a look at this, it just looks mangy.

It is worn and flimsy.

On the authentic jacket you have this, what we call our Arctic Disc.

And you can see the definition in the type.

There's not a thread out of place.

If you take a look at the fake jacket,

this is an ugly mess.

You can see the stitching on the inside of the label here.

Weird strands. The Arctic is messed up.

What's inside the fake coat is even worse.

These are two glasses filled with down

and what the counterfeiters put in their fake jackets.

So, we've had these analysed in a lab.

This one, the fake down, is 5% down.

It's 50% feathers

and the rest, who knows what.

Dust and dirt and whatever's on the factory floor.

This is down.

Down filaments are the underbelly of the bird that go under the feathers.

That's what keeps you warm.

The results of owning a fake coat like this could be serious.

If a consumer was counting on a jacket for their survival

and they bought a counterfeit jacket,

that could result in a life-and-death situation.

It's clear from looking at the fakes

that the quality isn't up to scratch.

But how well do they perform in the cold?

At Loughborough University,

Professor George Havenith studies how people perform

in extreme temperatures.

What we're standing in front of here is our climatic chamber.

We have two of those.

And we can simulate most climates of the world in these chambers.

We can go from -30 to +50.

Or we can change the humidity as well

and make it very humid or very dry.

So, to see how the coats perform on real people,

Professor Havenith is testing them on two colleagues.

Alex is wearing the fake jacket.

Simon's wearing the genuine one.

At the moment, I'm quite warm but I don't think so in a minute.

I think I'm going to be quite cold, so...

OK, let's take you guys in.

The climatic chamber is cooled to -20 degrees Celsius,

as cold as the average household freezer.

Alex and Simon will stay in there for half an hour.

Just make sure you're as warm as you can be.

My face is quite cold.

-Yeah.

-I'm not too bad.

It could be worse.

You've got the nice jacket.

So, what we're trying to do here is just to illustrate

how the jackets work on real people.

This will show us how people cool down.

And we would expect to see, with the infrared camera,

that actually Alex is losing more heat through the jacket.

So, he would feel colder and we would see more heat on the outside.

After 30 minutes at -20 degrees,

the differences between the two coats have become very clear.

I'm very, very cold now.

I've had enough.

After about 15 minutes, my nose hairs started to freeze.

Right, guys. I think you're cold enough.

But I do want to take a quick infrared picture.

Using the thermal imaging camera,

Professor Havenith takes a photo of Alex and Simon

to see how much heat is escaping from the coats.

OK, get your coats off, guys.

If you look on the left, it's the fake jacket here

and you see the bright colours showing how much heat

is coming through.

Whereas on the right-hand side, the real jacket,

you see much more darker blue colours.

So, in contrast of the two,

there's a lot less insulation in this jacket.

Professor Havenith's tests have proved

that when it comes to insulation,

the fake coat is vastly inferior to the genuine one.

The insulation of the real jacket is probably a third more

than the other one, so that's really a substantial difference.

And if you would go to the Arctic and depend on the jacket

and you would have bought the fake jacket,

I think you would be in trouble.

The existence of fakes is a major cause of concern for the company.

Most of the fakes are bought on what we call rogue websites.

So, these are counterfeiters that have taken our images,

taken our copy and created websites that look identical to ours.

So, it's very easy to get tricked.

But if you don't want to get caught out when buying online,

what can you do?

Some of the things to look out for are -

where's the phone number to customer service?

Where's the e-mail to customer service?

Sometimes you'll see on a fake site that the pricing is quite low.

Canada Goose jackets don't often go on sale.

So, it's rare that you would see that.

For Maya, it's a relief that she spotted the fake

before anything serious happened.

If I was wearing this coat on a day when it was raining,

when I'd been diving, I could have even got hypothermia

from the fact that this coat wouldn't keep me warm

and wouldn't keep me dry.

So, it's not just the case that I've lost the money,

it's the case that, actually, it could cause you harm.

All these letters were sent to large organisations,

like councils and hospitals,

informing them that the bank account details of one of their suppliers

had changed.

Fairly straightforward, you might think.

Thousands of letters like these turn up at organisations every year.

But all these letters are fakes, sent by criminals.

The new bank account has nothing to do with the legitimate suppliers.

That means councils, hospitals, big businesses, even charities,

can unwittingly pay huge sums directly to the fakers.

And an awful lot of that money... is ours.

Some large organisations can receive as many as 2,000 letters a year

from suppliers informing them of a change of bank details.

So, if a fake letter arrives,

you have to be pretty switched on to spot it.

Sharron Evans is finance administrator for the YMCA

in Cheltenham, which provides housing for homeless people.

When their existing building became too dated,

they knocked it down and built a brand-new one.

The percentage of homeless people was just rising

and they needed somewhere to go.

And we felt that, you know, we were in a position at that time

to be able to offer this.

After a consultation process,

the YMCA hired local construction company, Speller Metcalfe,

to build the new accommodation.

Andy Metcalfe is Chief Executive.

The value of the project to us as a construction

was approximately £3.6 million

and took about 18 months to complete.

As the project progressed, the YMCA made regular payments

to the builders for the work completed so far.

The next payment due was for £175,000.

But then Sharron received a letter.

The letter was from Speller Metcalfe

telling me that they'd changed their bank account

and that from this date forward,

to transfer any monies owed to them to this new bank account.

The letter had the correct logo and all the right details.

But something about it wasn't quite right.

I was suspicious because when I looked at the address,

there was a H missing.

Instead of Brockworth, it said "Brockwort".

I thought I needed to just check with them.

Sharron contacted the builders

to ask if they'd changed their bank details.

They then e-mailed me back and said, no, they hadn't.

The letter was a fake.

It wasn't from the builders at all.

If Sharron hadn't checked,

she would have paid £175,000 straight into a fraudster's bank account.

People have had to work and fundraise and everything

for that money.

For it just to disappear just like that, it would have been awful.

And for me to have to tell somebody that I'd lost £175,000...

Andy Metcalfe is concerned that someone was so easily able to fake

his company's identity and use it to try and steal money

from one of his clients.

It makes you intensely angry that somebody could come...

..and purport to be Speller Metcalfe.

That could look to come and take money away from hard-working people.

What Andy and Sharron experienced was a type of fakery

known as bank mandate fraud.

Will Richardson is a forensic accountant for auditors PwC.

It's something he sees regularly.

If we look at the last 12 months alone,

I've probably investigated about ten cases of mandate fraud.

The sums that have come across my desk of mandate fraud

are typically £500,000 plus.

Sometimes into the seven figures, into the millions as well.

And it's not just charities like the YMCA that are being targeted.

The fakers are after large payments from all sorts of organisations -

from private companies to schools, NHS trusts and local councils.

Like Conwy County Borough Council, in North Wales,

which recently embarked on a major redevelopment project at Colwyn Bay.

Mike Halstead is the council's head of audit.

In 2012, after a succession of storms,

the sea defence along this promenade was left severely damaged.

The project itself consisted of two major elements.

One was the sea defences and one was the building where we are now.

The whole scheme, when it's finished,

is expected to cost around about £25 million.

As the project progressed,

Conwy Council made regular payments to the building contractor.

The next sum due was £2.6 million.

Then, something unusual happened.

We were phoned by an individual who informed us that the

main contractor's bank details were changing.

This was slightly unusual, so we requested the submission of a letter

to confirm the new bank details.

But when the letter arrived, staff quickly spotted that it was a fake.

If the attempt had not been caught in time,

Conwy Council would have deposited a massive £2.6 million

of taxpayers' money into the faker's pockets.

The council would have had to recoup this money in some way,

which could have impacted on services.

For example, libraries could have been at risk.

Leisure centres could have been at risk.

Jobs could have been at risk.

And the attempt wasn't a one-off.

Conwy Council have received several fake bank change letters.

These letters are all purporting to be from different suppliers

to the council.

So, they are people we do do business with.

But they all have the same layout.

And interestingly, they all have the same signature,

which is an immediate warning for us that these are bogus.

Both the YMCA and Conwy Council were lucky.

Their eagle-eyed staff members managed to spot the fake letters

and avert disaster.

Other organisations haven't been so fortunate.

Guy's and St Thomas' NHS trust lost £24,000

after fraudsters sent a fake e-mail asking for a change of bank details.

The government of Guernsey paid out a massive £2.6 million to fakers

posing as the contractor working on the revamp of Guernsey Airport.

And another £2.6 million was lost over a 13-month period

by the owners of the Port of Felixstowe.

Again, paid out by mistake to criminals,

who faked the identity of the Port's fuel supplier.

And once the money's gone out, it's virtually impossible to get it back.

As soon as it hits a fraudster's bank account in the UK,

it's sent out of the UK.

It's quickly distributed across a number of different accounts

in different jurisdictions around the world,

which makes both the tracing of that money

and the recovery of that money almost impossible.

But in Felixstowe, they did manage to catch one of the fakers.

31-year-old Mohammed Fawzul-Rahman of Watford

was jailed for four years

after nearly half a million pounds of the Port's money

was laundered through his bank accounts.

The Port was able to recover about half the money stolen.

But around £1 million was never seen again.

Perhaps unsurprisingly,

companies who have fallen victim to mandate fraud

rarely want to talk about it.

But it's a huge problem for businesses in the UK.

One of our large UK banks, it's corporate-client based,

experienced almost £40 million of attempted mandate fraud in 2014.

Luckily, the attempts made on Conwy Council and the YMCA

were simple ones and by checking with the contractors,

they managed to avoid paying thousands of pounds

into a faker's bank account.

The worst-case scenario would be

that the building would not have been completed.

And that would have meant that all the people that we've helped so far

since opening, we would not have been able to help.

That's all from Fake Britain.

Goodbye.