Agencies say counterfeit goods are used to launder money

But as a major crackdown on pirated goods is announced, it appears the humble rip-off handbag may be the tip of an international crime iceberg.

Intellectual property crime in Britain represents a black market worth at least �9bn a year, according to the Patent Office.

Producing counterfeit goods on such a massive scale requires serious organisation and established distribution channels.

Some of these groups are involved in some pretty awful other types of crime Bryan Lewin, Trading Standards Crackdown on counterfeiters

Bryan Lewin, of Trading Standards Institute, says counterfeiting is seen by crime gangs as an easy way to launder money, which is then redirected into other criminal enterprises.

"Some of these groups are involved in some pretty awful other types of crime, such as people trafficking, drugs and in some cases terrorism," he told BBC News Online.

He said the practice was particularly widespread in Northern Ireland, although it stretched to all parts of the UK.

Counterfeit goods to the value of �7.6m were seized in Northern Ireland in 2002 - more than in all other UK police forces combined.

The Northern Ireland Office said part of that money would have been used to fund paramilitary groups and it is thought that two-thirds of the criminal gangs there are linked to such groups.

He said at least some of the people selling pirated goods at markets would be members of republican or loyalist organisations, or would at least have their blessing.

He acknowledged it was a "major problem" .

Sophistication

Ruth Orchard, director-general of the Anti-Counterfeit Group which represents 200 companies in 30 countries, said pirating operations were becoming increasingly sophisticated.

DVDs, CDs and clothes are popular targets for pirates

Ms Orchard said businesses are using special devices and strategies, such as incorporating holograms into a product, to protect their brands.

But she said the innovation only worked temporarily.

"The counterfeiters are able to catch up with them within two months," she said.

Companies have protection plans where security devices are rotated back and forth over the course of five years.

Eventually the gangs give up on that product and turn their attention to another, she said, but by then it has been a costly exercise for the companies involved as well.

She said people need to become aware of where the cheap goods they buy at market stalls or car boots may have come from.

The TSI's Mr Lewin said their research suggested that "if people knew the facts, they wouldn't buy the goods".

He said officers combating counterfeiting on the ground should also keep in mind who they may be dealing with.

"We have to adapt and employ tactics that fit the circumstances," he said, adding that trading standards staff were now using bullet-proof vests when moving in on some operations.

"These people have got a lot to lose."