TODAY | February 24, 2012
>>> back now at 7:43. this morning on rossen reports, the world of counterfeiting. it's scamming americans out of billions of dollars and now there is a new twist. "today's" investigative correspondent jeff rossen is here with the details. good morning.
>> good morning. we have heard about counterfeit products. it's been going on for years. now the criminals are so sophisticated they are buying real ad space and getting to you on popular and trusted websites we all visit every day. some say the websites are profiting from it. we are on the hunt with u.s. customs and border protection , searching incoming cargo to stop a criminal epidemic before it reaches your home. expertly designed counterfeit products sold as real. and where are unsuspecting americans finding them? on sites like ebay and google where criminals pay big bucks for prime placement.
>> it doesn't make them as trustworthy as we hold them to be.
>> reporter: high school senior lauren macmillan wanted to learn spanish so her dad spent $200 on what he thought was a never opened rosetta stone software kit.
>> the ad said it was brand new and shh ripg wrink wrapped.
>> reporter: it arrived and looked authentic down the instruction manual , stickers and inscriptions on the disk.
>> we tried to install it and it had an error message every time.
>> reporter: it didn't work because it's a fake. authorities say some even install a virus on your computer to steal your personal information. here's a real kit next to the fake one. can you tell the difference?
>> it's not just some college kid in their basement putting this together. this is a real business going on. somebody's making a lot of money off of it.
>> reporter: some say it's not just the criminals cashing in. it's the popular sites that allow them to advertise.
>> looking at this, make you angry?
>> disgusted. it's costing us millions.
>> reporter: tom adams is ceo of rosetta stone . they have caught google selling coveted top of the page ad space to over 1600 rogue websites with fake products. you go to google , type rosetta stone in and get a list of websites . on this day the real website and the company says all these fakes offering discounts. click on them and they look like the real thing.
>> they are essentially picking whatever media we have, photographs.
>> reporter: even your picture.
>> yeah, even me.
>> reporter: that's your picture. if i was an average consumer and i saw your picture, you're the ceo, must be legit.
>> i think that's what happens.
>> reporter: he says google isn't doing enough to stop them.
>> when you complain to google , what's the response?
>> they are back up shortly thereafter. google takes them down but it's a game of what cck-a-mole. the pirates have many accounts.
>> reporter: and google does business with them again.
>> reporter: in fact, google has been caught doing business with criminals before. last summer the company paid $500 million to avoid prosecution for knowingly selling ads to illegal online pharmacies. google declined our request for on-camera interview but told us, we take responsibility for our actions and google does not allow ads for any counterfeit goods . we use a combination of manual and automated processes to enforce this policy. in 2011 we shut down approximately 95,000 advertisers for counterfeit goods . but rosetta stone said it is not working.
>> this is the fake product sent to us by consumers.
>> reporter: they keep hearing from angry customers and had to hire their own investigators to scan for counterfeits.
>> here's a fake product on ebay. it has 28 bids up to $242.
>> it looks real.
>> reporter: also frustrating for law enforcement who admit they can't keep up with the flood of fakes.
>> it's increasing every year. we have had a 24% increase from last year.
>> it's a cat and mouse game.
>> reporter: part of the problem, many of the criminals are based in china, out of reach for u.s. authorities. that's where lauren 's kit came from. after complaining, ebay gave her a refund.
>> something needs to be done about this. people need to be aware this is going on on the internet. there needs to be a stop to it.
>> reporter: ? in a statement, ebay said counterfeits are not welcome. it said it is a leader in working in combatting counterfeits. as for the fake rosetta stone lauren bought they took the ad down just the day after it was posted. here's the takeaway. if you see new products at steep discounts that's a red flag . just because the site has prime placement on a site like google doesn't mean it's real.
>> if you have a counterfeit good what do you do?
>> if you bought it on a site like ebay where you buy it from them, tell ebay. you can get a refund hopefully like lauren did. if you find the fake website on google , for example. it's just a search engine. you probably won't get a refund. that money is probably gone.
>> maybe your report will change things.
>> i hope so.
>> still ahead, young girls opening