Counterfeit CDs threaten the record industry: Northern Ireland terror groups believed to be involved in importing discs from China and eastern Europe

THE RECORD industry is facing a growing threat from the sale of counterfeit compact discs.

Since April, near-perfect copies of albums by best-selling artists have begun to surface in Britain. Police believe the discs are being manufactured in eastern Europe and China, with profits helping to fund paramilitary groups in Northern Ireland.

The copies are appearing at car boot sales, in street markets and at record fairs. They are often on sale at only half the retail price, between pounds 5 and pounds 6, and are direct competition for legitimate sales.

Titles being copied include classical as well as rock and pop music. Artists include Mariah Carey, Simply Red, Take That, Phil Collins, INXS, Meatloaf, Queen, Rod Stewart, Diana Ross and Bob Marley.

The first counterfeit CDs to appear in Britain were found in Northern Ireland in April. These are thought to have been manufactured in China. Since then, police have seized quantities in Glasgow, Liverpool, London, Lancashire, the West Midlands, North Yorkshire and Buckinghamshire.

The first seizure in Britain was made in May at a car boot sale in Coventry. Trading standards officers took possession of about 40 discs and arrested two people. The case, the first of its kind in Britain, is expected to come to trial in the next few weeks.

A spokesman for the Royal Ulster Constabulary said paramilitary groups on both sides were profiting from the sale of counterfeit CDs. This year, the RUC has seized about 1,200 discs. A spokesman said: 'That is not a huge number, but we are convinced this is a growing problem.'

CD copies are a bigger threat than counterfeit cassettes. The digital sound reproduction means their quality is almost guaranteed. There is also little chance of a counterfeit CD damaging hi-fi equipment - a serious deterrent with illegal cassettes.

Tim Dabin, head of the anti-piracy unit at the British Phonographic Institute, said there was now a real danger of people being tempted into buying good quality, illicit CDs at half the price.

At the end of July, detectives and trading standards officers seized what they believe was the UK's largest single batch of counterfeit discs, at Dover in Kent. They found more than 10,000 discs after stopping a Bulgarian truck bound for a depot in east London.

One of the BPI unit's most recent successes came in Norwich two weeks ago with the seizure of a number of pirate CDs featuring Tori Amos. Mr Dabin said: 'The counterfeiters reproduced the entire booklet very well indeed. The only difference was a slight change in the grey sleeve and a change in the number etched into the centre of the CDs themselves.'

A police search resulted in two arrests, the seizure of 3,000 empty CD boxes and 800 discs of Amos's Under the Pink album. 'This was a relatively small operation, but you never know how big it might have got. There was evidence that their next order was going to be for around 20,000 discs,' he said.

Tracking the sources of CD copies is difficult. Some are made unwittingly by legal pressing plants. This is easy because operators rarely listen to the discs, and testing equipment checks only that a coherent signal is in place, not what it sounds like. Others are being made with the tacit knowledge of plant owners, or at underground facilities.

Counterfeit CDs are an extra burden on the music industry, which has had to cope with pirate discs (home-grown compilations of tracks from several albums) and bootlegs of live performances for about five years. In total, the sale of illegal compact discs is estimated to be draining around pounds 25m a year from the UK industry.

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