What on earth is a ‘Hermès gang’?
We had the same question after we read headlines earlier last month about a group of individuals who were criminally charged for illegally selling authentic Hermès handbags.
The Birkin and Kelly Resale Scheme
A group of 10 individuals began to recruit fake Hermès buyers from acting schools; the actors were instructed to dress in expensive luxury clothing and visit their local Hermès store to create a customer profile, with the objective of purchasing a handbag.
Once the actors were able to purchase a Hermès handbag, the gang provided them with the funds to complete the purchase, and allegedly also compensated them for their participation in the scheme.
It is estimated that each bag was purchased for an approximate price of $8,000. The gang ran this operation for over four years, and purchased close to half of the Hermès handbag supply. On average, it has been reported that they generated close to a million euros a month in resale revenue.
Resale of Authentic Hermès Luxury Handbags Isn’t Illegal
Buying and selling authentic luxury handbags, not just from Hermès, but from any brand is not illegal. If it was, leading authentic luxury consignments wouldn’t exist.
Although brands like Hermès, Chanel, and Louis Vuitton dislike the resale of their products, it isn’t something they can criminals charge someone for, unless the items are counterfeit.
These brands are recognized around the globe as being high-end, elite designer brands. To help maintain this brand image, there are only limited stocks and quantities of their handbags for sale to help establish brand exclusivity.
However, the resale market makes their bags more readily available for purchase. It removes the need for a customer profile, and purchase ‘prerequisites’ meaning that a minimum spend amount at the store is not required in order to be able to purchase a handbag. Additionally, many consignments offer pre-loved handbags for heavily discounted prices, which makes them more affordable, and accessible.
So Where Did the ‘Hermès Gang’ Go Wrong?
So, if the resale of authentic luxury handbags is not illegal, why was the Hermès gang criminally charged?
The answer is because they orchestrated fake Hermès showrooms in close vicinity to the central Hermès Paris Location, to mislead public buyers into believing the showrooms were affiliated with Hermès. This allowed them to list the bags well above retail price, and easily sell their inventory without having to sell privately or sell through consignments.
Some buyers may have believed they were purchasing from Hermès directly, and the listed prices of the bags were retail value.
Pretending to impersonate an legitimate Hermès Showroom is a crime, and there are legal repercussions in doing so; this is where the Hermès gang went wrong.
Scoring A New Hermès Handbag May Be More Difficult Now
As a result of this resale scheme, Hermès may take action to make the process to score a new handbag in store much more difficult to protect the exclusivity of the brand.
It’ll be interesting to see what changes the brand implements to help prevent this type of situation from reoccurring, and protect the sale of its handbags from scammers.
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