Licensing Survey Turns up Surprising Results: 50% of those surveyed report their product counterfeited

NEW YORK, Oct. 24, 2000; Kessler International, the premier international forensic accounting and investigative consulting firm, announced today that their survey on licensing compliance audits has netted amazing results.

The thrust of their findings came from a survey of over 500 companies worldwide that posed questions on the issues of Intellectual Property Theft and Royalty Fraud. Kessler’s survey sought to determine the prevalence of fraud uncovered by royalty compliance audits and how both licensees and licensors could combat the problem.

Although the majority of Licensed Property owners are well-intentioned, striving for mutually rewarding relationships with those who purchase the rights to use their properties, the survey concludes that a significant percentage employ few, if any, protective measures.  Only 15% admitted that they conducted yearly audits, 85% have not conducted an audit in over a year, and a staggering 71% have never conducted an audit.

Most astounding, however, is the fact that 25% of companies surveyed that do conduct audits have discovered major discrepancies requiring litigation to resolve.

An equally disturbing result of the survey indicates that a startling 55% of licensor’s employ no Internet monitoring system to ensure that their properties are sold within the limits of their agreements or that bogus goods are not being distributed on-line.

Finally, almost 50% of the survey group indicated that their property has been pirated or counterfeited within the last year.

As demonstrated by the results of the survey, there is a distinct need for Intellectual Property owners to comprehensively monitor their assets. Michael G. Kessler, the president of Kessler International and the originator of Web.Sweep®, a proprietary system that detects the use or abuse of intellectual property and other information on-line, stated that even he was surprised by the large number of corporations that still do not take the Internet seriously as a channel of product distribution. He stated that his Web.Sweep ® technology, which has been around for years, protects the abuses noted by the survey.

Michael Kessler also stated that his team of forensic accountants, investigators and researchers “has documented millions of dollars of fraud and deceit” during the royalty audits they have performed over the last few years. He states his team goes beyond the obvious, providing information that traditional accountants often misinterpret or overlook when searching for answers to royalty issues.

For additional information on Intellectual Property Theft and Royalty Fraud visit the Kessler International website at www.investigation.com. Additionally Michael G. Kessler, President and CEO of Kessler International will be available for interviews at Brand Licensing London, October 25-26, 2000 in the Business Design Centre, Stand 433.  Michael Kessler can also be contacted at Kessler International’s European Headquarters in London, at 28 Grosvenor Street, London, England W1K 4QR (207 9179690) or the New York Headquarters at 237 Park Avenue, New York, NY 10017 (212 286-9100).

Kessler International has offices in Buenos Aires, Chicago, Hong Kong, Jakarta, London, Los Angeles, Miami, New York and Tokyo.