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Counterfeit market reaches half billion dollars

WASHINGTON, D.C. - Members of the U.S. Senate and tribal leaders accuse foreign interests of a major economic assault on the Indian arts and crafts market through importation of counterfeit goods which claim to be Indian made.

They place partial blame for the situation on the lack of enforcement of a law supposed to ensure the authenticity of arts and crafts said to be Indian.

"Today's market for Indian-made goods is roughly $1 billion, but by some estimates half of that demand, nearly $500 million, is satisfied by counterfeit goods - much of which is produced off-shore and imported into the United States," said Senator Ben Nighthorse Campbell, chairman of the Senate Committee on Indian Affairs.

The Indian Arts and Crafts Act, initially passed in 1935, established the Indian Arts and Crafts Board as a separate agency of the Department of the Interior to promote the economic welfare of American Indians and Alaska Natives through development of Indian-produced arts and crafts.

Through its criminal provisions, the act was intended to protect Indian cultural heritage and to assist the efforts of tribes and their members to achieve economic self-reliance. The law was amended in 1990 to strengthen criminal and civil penalties for misrepresentation of Indian-made goods and to expand the powers of enforcement of the Indian Arts and Crafts Board. The board's five commissioners are appointed by the Secretary of the Interior.

During a recent Indian Affairs committee hearing on the issue, senators called on the board and the Department of Justice to do a better job of charging and convicting those who violate the law. To date, board has received 45 written complaints, yet, no action has been brought in any case. Commissioners claim it is because the board is not authorized to investigate complaints. While Justice has acted in a number of cases under the law, none has been as a result of board recommendations.

"The IACB is largely reliant on the volition of the appropriate investigative authorities," said Faith Russell, its chairwoman. "The IACB is working to create a formal referral process both within the Department of Interior and the Department of Justice."

Committee members and other senators present were encouraged by these ideas, but remained skeptical.

"Aside from the lack of resources, I think the Indian Arts and Crafts Board has really failed to step up to the plate," said Sen. Jon Kyl, R-Ariz. "According to the latest information I have, not a single case of misrepresentation has been referred to the Justice Department for prosecution."

With the board and the administration looking to find a better way to enforce the law, tribes become important players in successful prosecutions. To address continuing problems and its cultural and economic interests, the Ho-Chunk Nation has filed 12 suits under the act in the northern district of Illinois. Three of the 12 cases are pending and nine have been settled out of court.

Public records show the Ho-Chunk secured injunctions against nine defendants. The injunctions prohibit any future violation of the Indian Arts and Crafts Act and provide provisions for prominent disclaimers that some Indian-style products are non-Indian made. One injunction provides for detailed continuing oversight of the defendant's marketing methods regarding Indian-style goods.

"The term "arts and crafts" does not do justice to the cultural creations about which we speak", said Jacob Lonetree, president of the Ho-Chunk Nation.

"These works embody the culture and identity of a people, and reflect personal and family history. They are a fundamental means of expression as to who we are as Native Americans and as members of our respective tribes."

This is where tribes have an advantage in pursuing cases, in the economic and cultural connections which offer greater incentives for pursuing violators.

"These actions are expensive and difficult cases brought after extensive investigations, but they can and have been effective," said Lonetree.

However, many tribes must rely on the government for action since they may not have the resources to carry out such activities.

To address some of the problems of enforcement, Sen. Campbell is proposing creation of a joint task force "to devise and implement a coordinated enforcement response to prevent the sale or distribution of any produced or good sold in or shipped to the United States that is not in compliance with the Indian Arts and Crafts Act."

The task force would be comprised of representatives of the U.S. Trade Representative, the Department of Commerce, the Department of Interior, the Department of Justice, the Department of Treasury, the International Trade Administration, and representatives of certain other agencies and departments.