COUNTERFEIT films, computer games and music CDs have been seized in a series of dawn raids on homes.
The raids were carried out by Durham County Council's trading standards officers working with the police and Department of Work and Pensions officers.
The suspected counterfeiters were also thought to be defrauding the benefits system.
More than 3,500 counterfeit films, computer games and CDs, worth more than £100,000 if they had been genuine, were recovered from homes in Consett and Wingate, County Durham.
Quantities of materials used to manufacture copies were also seized.
It is thought the fakes were being produced for sale at car boot sales across the North-East, with the intention of making illegal sales of thousands of pounds.
Some of the films included copies of recent cinema releases such as Thunderbirds and Catwoman, which have only just premiered in the UK.
Peter Fleming, assistant head of Durham County Council Trading Standards Service, said: "We hope this sends out the message that we are taking a hard line with persons breaking the law and producing counterfeit goods."
He said the operation was plan-ned to tackle people involved in a number of criminal activities.
Trading standards would continue to target counterfeiters who made substantial profits from breaking the law, he said.
The raids followed a recent prosecution by trading standards against a Derwentside retailer who was fined nearly £2,500 by magistrates for selling counterfeit cigarettes.
Councillor Don Ross, deputy leader of Durham County Council, said: "Sales of counterfeit goods threaten jobs within our county by stealing trade from legitimate traders.
"Counterfeiting is not a victimless crime, and the money gained from film and music piracy often funds other areas of criminal activity which affect our communities."
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