Protecting Consumers by Filtering out Fraud

While most inadvertent knockoff purchases just result in disappointment for consumers, counterfeit water filters pose a danger if they fail to meet key standards required to extract harmful contaminants from drinking water. The Association of Home Appliance Manufacturers fought back against this threat with research, advocacy, and a public awareness campaign.

The Challenge

Counterfeiters flooding the American market may provide consumers with problems instead of deals. In fiscal year 2019, U.S. Customs and Border Protection and U.S. Immigration and Customs Enforcement-Homeland Security Investigation seized 27,599 shipments containing goods that violated intellectual property rights. The total estimated manufacturer’s suggested retail price of the seized goods, had they been genuine, increased to over $1.5 billion.

While many of these goods, like clothing or accessories, may only represent financial loss for consumers, counterfeit water filters sold online pose serious consumer health and safety risks. As unscrupulous vendors copy trusted manufacturers’ branding and make false performance claims, consumers are conned into purchasing these dangerous products. Ninety percent of filter purchases are made online, where it is difficult for households to ensure they are purchasing a quality product. Hiding behind stolen brands and foreign websites, these fraudulent manufacturers avoided the regulatory checks required of upstanding water filter manufacturers and ultimately put American consumers at risk.

In 2016, appliance manufacturers recognized that many insurance claim investigations stemmed from consumers use of fraudulent replacement water filters purchased online. The Association of Home Appliance Manufacturers worked with the companies to understand the problem and pursue a solution.

The Approach

AHAM and the appliance manufacturers set out to develop a solution that would protect consumers from purchasing defective filters. To validate initial suspicions that counterfeit water filters failed to sufficiently protect consumers from contaminants, AHAM engaged independent laboratories to conduct a series of tests. All of AHAM’s members use consensus-based American national standards for drinking-water systems to test and certify that their products meet these standards.

These independent labs structured three tests for more than counterfeit water filters— all of which failed to meet U.S. safety standards. A test for lead filtration found a large proportion of counterfeit filters failed well before they filtered six months’ worth of water. They also failed to adequately reduce cryptosporidium contaminant. The most concerning finding was that after exposure to contaminated water, counterfeit filters showed potential to introduce contaminants into clean water.

The research was just the first step. Once the findings were released to AHAM, they determined to provide government agencies with the data necessary to justify intervention. AHAM published their results in a nine-page report, “Fake Filters, Real Problems,” which outlined the outcomes of each filter test using charts, graphs, and descriptions of the methodology.

AHAM also sought to raise awareness among consumers via the website filteritout.org, which contained informational videos, a consumer quiz, the full research report. The site encouraged consumers to use verifiable methods of purchasing a certified water filter by way of manufacturer’s websites. While the research was in progress, a paid media campaign generated millions of impressions and 21,000 clicks to filteritout.org. Once AHAM released the research findings, the accompanying video outlining the dangers of counterfeit filters received more than 30,000 views in a three-month period, and publications like Real Simple, Yahoo! News, and syndicated TV outlets including Investigate TV talked with the initiative’s leaders, further raising awareness. The Investigate TV piece garnered more than 40 million views across the United States

Outcomes

The primary lesson for AHAM has been the value of expanding beyond its traditional scope. AHAM primarily focuses on developing standards, government affairs, and related activities, so a consumer awareness campaign was a new arena. Member support and collaboration has been critical to their initial success.

Additionally, the research turned out to be essential to the acceptance of this campaign by regulators and media. The initial strategy was to identify several “victims” of counterfeit water filter purchases, but it soon became apparent that a broader sample of data was needed to speak to the credibility of AHAM’s message and to justify the request for increased action from government agencies.

Finally, the experience gained from implementing a consumer-facing endeavor of this caliber has resulted in greater member interest in the potential marketing implications of such efforts, paving the way for AHAM to undertake more projects with a focus on external impact in the future.

Impact

Safe water is critical to human health and survival, and consistent filtration is especially needed in water crisis zones like Flint, Michigan. While water may look, smell, or taste fine, people cannot always detect harmful contaminants.

Homes to the primary victims of defective filters. AHAM’s independent laboratory investigations found many counterfeit filters failed to remove contaminants from household water, and some counterfeits even introduced harmful compounds. Presenting this data to decision makers was essential to AHAM’s ability to help address this issue and impact changes to protect the public. The “Filter It Out” campaign reached more than 40 million consumers and has potentially prevented hundreds of thousands of harmful products from reaching consumers.

“In 100% of the cases, all of the counterfeit filters we purchased failed the lead testing requirements, and they also failed the cyst testing requirements. We needed to have the evidence and research from credible, third-party bodies in order to verify this data and make a really strong case to the government agencies in our advocacy efforts that this is truly a problem.” —Jill Notini, AHAM Vice President of Communications and Marketing

References

Association of Home Appliance Manufacturers, “Fake Filters, Real Problems” https://filteritout.org/wp-content/uploads/2018/05/FilteritOut_Report.pdf.

Investigate TV, “Fake Filters? Counterfeits on the Market” https://www.investigatetv.com/fake-filters-counterfeits/.