War declared on £8bn counterfeit goods trade

Fake goods are costing industry billions of pounds and causing injury and distress to bargain hunters, Melanie Johnson, the Consumer minister, will warn this week.

She is revealing government plans to use tough new sanctions against people making and selling counterfeit goods. It will impose "stop now orders", under which rogue traders could face prison or unlimited fines. Shoppers, many of whom have no idea they are being duped, will be told how to spot the fakes.

A string of worrying cases has prompted concern about the activities of counterfeiters. In a speech in London on Wednesday, Ms Johnson will highlight the risks to people who buy them. Counterfeit goods recently found in the UK include phoney Star Wars videos, children's videos recorded over porn films that had not been properly erased and fake vodka, whisky and alcopops containing methylated spirits and anti-freeze. Others included "Tetley" teabags containing metal filings, floor sweepings and rat droppings, "BMW" wheels made of a sub-standard alloy, and perfume made from urine.

Counterfeiting is not just dangerous for the consumer: it costs UK industry an estimated £8bn a year. The Global Anti-Counterfeiting Group believes up to 12 per cent of products in the toys and sports market place are fakes. That is 11 per cent in the clothing and footwear sector and 10 in perfumes and toiletries. Up to 6 per cent of all pharmaceuticals in circulation are believed to be counterfeit.

Ministers are also concerned about links between counterfeiting and organised crime. The National Crime Intelligence Service says 26 per cent of drug traffickers are involved in counterfeiting. In raids by the European Leisure Software Publishers' Association, officers found other criminal activities in 80 per cent of cases.

A senior government source said: "Fake goods are at best poor quality and at worst deadly. Counterfeiting isn't street-corner spivs offering so-called bargains from a suitcase or the back of a lorry; it is often linked to organised criminals."

The Department of Trade and Industry advises customers to buy products from reputable retailers, to check labels for misspellings or poor quality, to ask for guarantees, to be aware that anything can be faked, and to be wary of extraordinary bargains.

"If something seems too good to be true it usually is," the advice says.