The sports memorabilia market has a long history of being overrun with counterfeit items. To combat the problem, sports leagues, particularly the Major League Baseball, have beefed up their authentication processes. Nonetheless, most experts estimate that over half of the objects currently on the market are counterfeit, putting anyone interested in collecting at risk.
Sportafi is helping make the sports memorabilia market more secure and transparent. A marketplace where all sports fans, even those just starting to collect, feel good about their purchases and exchanges.
It wasn't long ago that if you had a little skill with a pen and some merchandise, passing off counterfeit items as genuine wasn't difficult. Let's take a look at a few of the most skilled forgers; how the sports world shifted to address the problem; and how Sportafi is already making it harder for counterfeiters to make a quick buck off of unsuspecting buyers.
The FBI discovered a problem with counterfeit items flooding the market in the early 1990s and launched Operation Bullpen, led by Tim Fitzsimmons. The search for fake memorabilia rings began in Chicago and led them to Southern California.
By the 2000s, the investigation found that the operation had spread nationwide. The FBI dismantled dozens of counterfeiters and co-conspirators who were producing, distributing, and selling hundreds of thousands of forged autographed items.
Greg Marino, who Fitzsimmons described as "one of the best" he had ever seen, was at the heart of one of the major enterprises operating out of Southern California. Marino was able to produce signatures of some of baseball's greatest players, like Babe Ruth and Mickey Mantle, with ease and precision.
Because of Marino's talent, the Greg Marino and Wayne Bray ring had by far the most scope and sophistication. The counterfeiters created tens of thousands of items, and while the FBI has seized hundreds in searches over the years, there's no way of knowing how many are still out there.
As soon as one ring is dismantled, another emerges, and with the rise of the internet about the time the Marino/Bray ring was dismantled, someone else stepped in to take his position.
Operation Stolen Base
When it comes to selling counterfeit things, many forgers take advantage of the anonymity provided by the internet, but one of the best was Cliff Panezich, a disillusioned baseball star.
Panezich’s father passed down his dream of playing in the major leagues to his son. Cliff had only just begun his career when his throwing arm was injured, requiring him to take time off in order to receive the surgery he required in order to continue playing long-term.
Panezich began with a real memorabilia business, selling whatever autographs he could find on college campuses, but he barely made a profit. When he began to notice things that were blatantly counterfeit all throughout the marketplace, he grew irritated.
Once Panezich realized how easily he could recreate signatures in 2010, it was hard to resist getting in on the action. Cliff and his co-conspirators gathered autographs, and Panezich went to work reproducing the signatures in order to pass them off as genuine.
The FBI identified the forgery ring in 2014 and launched Operation Stolen Base, and by November, they had discovered more than $1 million in eBay sales with over 16,000 potential victims across the country. Panezich's actions were monitored by the FBI, who rummaged through his trash for evidence of fraud, including bogus certificates and scratch paper used for practice signings. They were able to acquire search warrants and arrest Panezich and his co-conspirators as a result of this evidence.
Responding to Counterfeiters
After the FBI bust in the early 2000s, the MLB bulked up on its authentication processes. At every major league contest, from spring training to the finals in October, there are at least two authenticators to keep track of everything from jerseys to foul balls.
The authenticators use a complex note-taking method that gets much more complicated when it comes to the baseballs themselves. To acquire the silver holographic tag that signifies authenticity, they must track down exactly how the baseball changed hands—something that becomes progressively more critical as players approach big milestones.
Quite possibly the most challenging part of an authenticator’s job is tracking down home run balls. Even in the most controlled environments, baseballs have a way of getting lost. The pandemic provided a rare opportunity for more home run balls to be authenticated thanks to the empty stadiums. As stadiums fill back up, the league would benefit from a system that would allow fans to register their baseballs at the stadium and give the league a more secure way to track these often significant items.
The MLB already has a stronger system in place, and other leagues are beginning to follow suit. While their systems have already significantly helped reduce fraud on the market, Sportafi helps expand the security beyond the initial sale and records every transaction and change of hands.
Sportafi’s unique patented software and hardware technology combines sports memorabilia and collectibles with a digital asset, resulting in an immutable digital asset that serves as the object’s "token" or key for verification. The token is then irrevocably linked to the physical object. Both are required to complete a transaction; one without the other renders the transaction invalid.
Unique, tamper-proof identifiers, such as the RFIDs used in NFL footballs, serve as the link between physical items and the blockchain. This pairing makes it easier to verify the authenticity of a collectible and more difficult to generate fake memorabilia, which benefits both fans and the leagues/teams/players involved.
These security features will effectively eliminate fraud in the marketplace. Due to the time, place, and biometrics criteria from when the object was validated or registered, it's nearly impossible to duplicate a digital asset. Time is immutably recorded on the blockchain, with the kiosk serving as the GPS anchor. In addition, the owner, official, authenticator, and/or player’s biometrics are all recorded.
As a result, even if an item is stolen or lost, the owner can retain possession. The authenticating token (NFT) cannot be sold without the physical item, and vice versa.
To further prevent fraud, authenticating companies and sports leagues' officials stake their reputations on the verification of these items. Once an individual is found to be authenticating fake items, all credibility is lost. In addition, a database of all authenticators and items accessible to all prospective buyers brings a level of transparency never seen in the sports memorabilia world.
How it Works
Sportafi plans to work with authenticators to pair existing items with digital assets, creating an immutable record. If you have an item that you would like to authenticate, these are the steps you would take:
Bring the piece of memorabilia to any authenticating agent with a Sportafi kiosk. In addition to registering the item, it will also be authenticated by an expert.
The item is then paired, creating an immutable record of the physical asset, logging the time, location (business office of agent), and biometrics of the owner, authenticator, as well as representative of the business.
If a unique, tamper-proof token is not already attached to the item, one will be added and it will become a part of the record.
Any transaction or exchange thereafter can be conducted through the Sportafi mobile app or the Digital Wallet accessible on the Sportafi website.
If you have any questions about the process, feel free to check out Sportafi.com or get in touch with one of our experts.
The Future of Sports Memorabilia
Leagues will be able to keep better track of objects by connecting sports memorabilia with digital assets, and thanks to smart contracts, all parties involved will be reimbursed immediately whenever the item changes hands. Sportafi's approach also creates a more open and secure marketplace, allowing purchasers to be confident that what they are buying is genuine.
In 2021, the global market for sports memorabilia was anticipated to be worth $412 billion, and by 2032, it is expected to be worth $692.4 billion. There are other fascinating developments in the sector that will surely aid this progress, and counterfeit items, thankfully, have no place in the future of sports memorabilia.