Mob mints music moolah

Crime syndicates play CD pirating game

Organized crime has entered the counterfeit CD business in a major way, according to the RIAA’s analysis of recently compiled data.

CD-R reproduction in the Eastern half of the U.S. is now dominated by organized criminal syndicates, the RIAA noted in its annual record of statistics and enforcement efforts regarding commercial (non-Internet) piracy.

The Recording Industry Assn. of America reported a 58% increase in seizures of counterfeit CDs — the authentic CD look-alikes with high-quality artwork and packaging that make the product appear legitimate — seizing 1.2 million counterfeit discs in 2004.

“The practice and trade of music piracy have become more sophisticated, cunning and connected to organized crime,” said Brad Buckles, exec VP of antipiracy for the RIAA.

The growing number of smaller-sized CD-copying plants over the past few years has created excess production capacity, and some unethical businesses have diverted this excess capacity to the production of high-quality pirate product.

Organized crime units are operating on high-volume, low-profit-margin principles. Local police agencies, therefore, are now more likely to seize raw materials than finished music product.  In 2004, the number of counterfeit CD-Rs seized declined 27%, while the seizure of counterfeit labels rose 372% and seizures of CD-R burner equipment nearly doubled compared to 2003 levels.

Latin looting

Latin music continues to be among the most heavily pirated genres, making up nearly half of all illicit music product seized in 2004.

Law enforcement sweeps have driven counterfeit products off the street and into indoor retail locations. The illegal works have even found their way into legal music retail outlets but are more often sold at convenience stores, liquor stores and corner markets.

The RIAA reported a 21% decrease in the plain-view seizures that are typical of street-vendor enforcement, and street vendor arrests have also declined. Law enforcement is increasingly making more targeted arrests at the distributor and manufacturer level.

“There is no question that our efforts have made a real impact — an impact that will translate into real benefits for current and future Latin artists and their fans. We nonetheless know there is tremendous work left to be done,” said Rafael Fernandez Jr., RIAA veep of Latin music.

Raids were conducted last year in Los Angeles, Atlanta, Philadelphia, Miami and New York, as well as Virginia and Colorado.

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