By Lea Thompson Chief consumer correspondent
NBC News
updated 3/14/2005 11:03:33 AM ET 2005-03-14T16:03:33

You've seen them just about everywhere — on Tom Cruise, Russell Crowe, and John Kerry. They're the fashion must-have: A yellow rubber wristband bearing the imprint "Livestrong." It's the creation of — and cause for — Tour de France king and cancer survivor Lance Armstrong.

"[It's] something that they can wear and look at or give to a family member or a friend —somebody that's fighting the illness — to remind them, like it says, [to] live strong," says Lance Armstrong.

Since last summer legions have heeded that call, buying the bracelets for just a buck, with all the proceeds going to cancer research. The Lance Armstrong Foundation says they've raised $33 million to-date, all from a simple trademarked band.

A band that now has its own bandwagon.

Last year suburban kids Kyle and Sydney Allon hopped aboard. They bought and resold the Livestrong bracelets to classmates — for a dollar — as part of a family project to raise awareness about cancer. It's a cause they are passionate about since they lost their mom in 2003.

"I want to help because my mom died of cancer," says Kyle. "So I want to help people who have cancer so they don't die."

Kyle and Sydney purchased the bands directly from the Lance Armstrong Foundation, so they were surprised when they saw them for sale in a mall near their home in Connecticut. Their dad asked the store's owner about it.

"They said, 'we're not selling them for the charity, we're just selling them like any other product,'" says David Allon.

Not a dime was going toward anything close to cancer research.

"Why? Why are they doing this to get money for themselves?" asks Sydney. "Why aren't they just doing it for cancer research?"

The fact is, the Lance Armstrong Foundation only sells its bands in four places: Its Web site, Discovery Channel stores, Build-a-Bear workshops and select Nike locations.

So was the Allon's discovery a fluke? Curious, Dateline hit the streets looking for counterfeit Livestrong bands. And sure enough, we found them, in all the wrong places.

In Chinatown, New York they were on the streets. We asked if the proceeds were going to charity. The vendor, who spoke Mandarin Chinese, had no idea.

We moved on. Another vendor had plenty of Livestrong bands for sale, in a rainbow of colors matching every outfit. The Lance Armstrong Foundation says it makes its bracelets in only one color — yellow. Anything else is a fake.

We found similar colored Livestrong bands in convenience stores all over the country.

"I just work here," one clerk told us. "Whatever they bring in, I'm selling it."

At a dollar store in Alexandria, Virginia, the clerk took a green Livestrong out of its wrapper to convince us it was the real deal. You have to wonder, where are all these bracelets — in so many colors — coming from?

Meet Jeff. He works for a distributor called Jumbo Products. It supplies stores with all sorts of novelty items. Dateline recently visited Jumbo's New York warehouse with our hidden cameras rolling. We told Jeff we wanted to buy Livestrong bracelets in bulk. No problem, he said, but not the authentic ones.

Though they sure did look like it. The colors on Jeff's phony packages look just like the colors used by the Lance Armstrong Foundation, black and yellow.

"It's identical," says Jeff.

In fact, Jeff says his knockoffs are so good and demand is so strong, he's been able to sell them to would-be vendors like us all over the country.

"Every time we order it, it goes out," he says "If we order 10 cases, it goes out. If we order 20 cases, it keeps going out. It's a very, very good seller."

Some people may not care if these bands are fake, but Jeff warns some do, and they let him know it.

"One or two complaints from the customers themselves — not from the store owners — but from customers saying that, 'oh, it's wrong' and so on and so forth."

But Jeff has an answer for that.

"If a customer asks you if you donate money, go, 'listen you can donate $10, $20 out of your profit' and just tell them you donated. Just do it that way."

And speaking of profit, Jeff suggests we can get a lot more than a dollar for them — we can even sell them on eBay.

"I've been selling a dozen for $20-30. I sold one for $5."

And he's not kidding. Dateline found scores of Livestrong bands — authentic and knockoffs alike — on sale over eBay. We pledged up to $20 dollars for one in lilac and lost out to an even higher bid. Mind you, none of the sellers claimed their profits were going to charity.

So what's the harm? After all, you see knockoffs of name brands sold on street corners in just about every city. Manufacturers will tell you they lose a lot of money that way, but in this case, the money is lost to charity — lost to cancer research.

"I am personally outraged that anyone would exploit cancer funding for profit, which is exactly what's happening here," says Richard Blumenthal, the attorney general of Connecticut.

Some knockoff artists in his state have already gotten a knock on the door.

"I think that a prosecution always sends a message," says Blumenthal. "And the distributor is a direct participant in this scheme. The retailer, the convenience store owner, also bears a measure of blame. And he will be made to pay."

New York State has also recently sent the same message to profiteers, requiring them to "donate" some of their proceeds to charity. And other states may soon start running down counterfeiters.

A new line of bracelets is popping up in stores and over the Internet promising proceeds will benefit tsunami relief victims. We had to wonder, will Jeff see another opportunity for knockoffs here?

"For now, we still think it's too early to make a profit out of something so tragic," he says. "Unless we see other vendors selling it and then we go, 'okay, know what? I think it's about time.'"

Mind you, there are plenty of other vendors out there, selling bands with messages supporting other charities. Many are legitimate. But that wasn't the case with the Livestrong vendors we found.

Dateline wrote to those stores asking how — in good conscience — they could rip off the trademarked Livestrong wristbands. Only Lili in New York's Chinatown responded, telling us she was unaware the bands were trademarked. And about the bracelets listed on eBay? EBay says that in line with its policy the Lance Armstrong Foundation will have to "prove the listings are, in fact, counterfeit before eBay will end the listings."

As for Jeff's company, but we did finally reach it by phone. Someone calling himself Thomas apologized for what he called the company's "mistake," adding it would be donating money to charity. In fact he said, "the check would be in the mail."

And what does the Lance Armstrong Foundation think about all this? It told us that reselling its authentic bands — for a dollar — to help the cause is one thing. But it also said that counterfeiting its trademark bracelets is "disappointing" and it wants those who are doing it to know "it is not only illegal, but it is unethical to profit" from the sale of the bands.

Which is exactly how David Allon sees it. He says the episode may have taught his children an unavoidable lesson in human nature.

"Even when there are altruistic causes like cancer research, there will be people who will try to find the scam and take advantage of the demand," he says.

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