When the Certificate Is the Thing Being Faked
Japan's new taskforce wants better card authentication. Collectibles already grade, seal and serialise every item, and counterfeit submissions still rose 45%.
TL;DR
- Japan's ruling LDP set up a parliamentary group on the trading card market, first meeting 23 July 2026, citing scalping, counterfeiting and money laundering in a market worth about 338.4 billion yen.
- One remedy under discussion is better authentication. Collectible cards are already among the most authenticated consumer goods there are: graded, sealed, serialised and listed in a public database.
- PSA intercepted more than $200 million in counterfeit and altered collectibles in 2025. Counterfeit Pokémon submissions rose 125 percent, and counterfeit PSA holders are now part of the fraud mix.
- Population figures are published and fixed. A market carrying more copies of a card than were ever issued is a countable condition, and no participant currently sits where that count is visible.
Japan's ruling Liberal Democratic Party set up a parliamentary group on the trading card market this summer. It first met on 23 July, taking evidence from the Ministry of Economy, Trade and Industry and the Japan Toy Association. The market it is examining reached about 338.4 billion yen in fiscal 2025, roughly 2.3 billion US dollars, and has grown every year since 2017.
The concerns the group named are scalping, counterfeiting and money laundering. Among the remedies under discussion are authentication methods and better technology for detecting fakes. Its chair, Kihara Seiji, has already cautioned that the group "must not strengthen regulations to the point of destroying the market."
That is a sensible list, and it is worth noticing that trading cards are already among the most heavily authenticated goods a consumer can buy. A graded card sits in a sealed, tamper-evident holder carrying a printed grade and a certification number that resolves to a record in a public database. Third-party grading has been an established industry for decades. If item-level authentication were sufficient on its own, this is the category where you would expect to see it working.
The numbers describe submissions
PSA, the largest of the grading companies, published a fraud report in May covering 2025. It estimates it intercepted counterfeit and altered collectibles with a projected market value of more than 200 million dollars in a single year. Counterfeit submissions rose 45.3 percent year over year. Counterfeit Pokémon cards were up 125 percent. Detected alteration of Pokémon cards rose by more than 400 percent, against 1.6 percent for sports cards. PSA president Ryan Hoge called the 200 million dollar figure conservative and said that at the extreme end "that number could be well north of a billion dollars."
On some individual cards the hit rate is startling. Of thirteen T206 Honus Wagners submitted for grading, twelve came back counterfeit, a rate of 92.3 percent.
Read those figures carefully, because every one of them describes a submission. Each fake was caught at the point where someone voluntarily handed an object to an expert and paid for an opinion on it. The grading step is doing its job. What happens either side of that step is the open part.
The certificate becomes the target
PSA's own report notes that counterfeit PSA holders are now part of the fraud mix. Once the holder functions as a proxy for authenticity, the holder is worth faking, and a fake holder carries whatever certification number the counterfeiter decides to print on it.
This is a shape we ran into recently in a very different market, when Delhi police found hundreds of genuine Keytruda vials that had been emptied, refilled and resold. The container was real, so the check passed, because the check was asking about the container.
Hoge made a second point that gets less attention than the trophy cards. "We might find cards that are 100 to 300 dollar cards," he said. "If somebody can make a counterfeit version for one dollar and get it into the market, they'll do that all day long." Nobody sends a 200 dollar card away for grading and waits weeks for it to come back. That whole tier of the market moves on photographs and trust.
Why money laundering is on the list
Kensaku Fukui, a lawyer at Kotto Dori Law Office, told the ABC that alongside fraud and theft the trade risks being "exploited for illicit overseas money transfers, such as money laundering." It is worth thinking about what a high-grade card is as an object. It is small, light, internationally liquid, priced by opinion rather than by any public tape, and able to cross a border inside an envelope.
Logan Paul bought a Pikachu Illustrator for 7.5 million dollars and sold it this year for 22.6 million. One of only forty issued in 1998, and the only one graded 10. Paul is also the buyer who lost almost 5 million dollars on a box of fake cards. If the most capitalised participant in the market, with every resource and every incentive to verify, can be taken for that, the odds facing an ordinary buyer are not encouraging.
Europol and EUIPO argued the general version of this in their June 2020 report on poly-criminality: IP crime rarely operates on its own, and the networks running it are usually running something else alongside. High-value collectibles add a value-transfer function on top of the counterfeiting.
A law that stops at the border
Fukui's harder point is jurisdictional. "Even if a law were enacted, it would only apply within Japan," he said. He does not think regulation alone is the answer, and expects the group to work with industry and resale platforms instead, with international cooperation as a requirement rather than a nice-to-have.
Japan's existing countermeasures are instructive here, because they act on people rather than on objects. The Pokémon Company runs lotteries that require official Japanese ID. Pokémon Center Online has required a My Number Card for certain purchases. One store cut the corners off packs to make them worthless as sealed resale stock. A Tokyo shop made customers pass a fan-knowledge quiz before buying. Those are anti-scalping measures and they work by binding a buyer to an identity at the till. They say nothing about where the card is six transactions later.
The signal nobody is positioned to read
There is a different kind of evidence in this market, and it is arithmetic rather than forensic.
Forty Pikachu Illustrators were issued in 1998. One of them is graded 10. Those are published, fixed numbers, and they put a hard ceiling on how many can legitimately be offered for sale at any grade at any moment. The same holds, less dramatically, for every graded card, because population reports state how many exist at each grade. The supply is countable.
So a market carrying more copies of something than were ever made is a detectable condition, at least in principle. It is not detectable by looking at any single card, which is the only thing most of the current tooling looks at.
The difficulty is that no participant occupies the vantage point. A grader sees one submission at a time. A marketplace sees its own listings. A buyer sees one card and one certification number that, checked on its own, comes back clean. The flow runs across auction houses, marketplaces in several jurisdictions, group breaks, private sales and cash changing hands at conventions. Item-level authentication has its place and it answers its question well at the moment you ask it. The count is a different question.
Which leaves the taskforce, and anyone who has to price a card, with something harder than a detection problem. What would it take to see the population and the flow at the same time? What does it look like in the record when a card is graded, cracked out, altered and resubmitted, and one object has quietly become two? How many copies of a card with a population of one are on offer this month across every venue that sells them, and who is in a position to count?
Image: "Pokémon Trading Card Game QR Code, Hillegersberg, Rotterdam (2021) 01" by Donald Trung Quoc Don, licensed under CC BY-SA 4.0, via Wikimedia Commons.