imitated swatch of brown leather—and replaced it with a black-leather swatch embossed with a delicate silver tree print. Such changes help to put distance between loyal customers and the wannabes. “At one time, whatever fakes you found in Soho, I could be shipping a similar product at the same time,” says Drake. “That no longer happens.”

But as designers are stepping up their game, so too are counterfeiters, says Luann Ensminger, chief of the commercial fraud unit for Immigrations and Customs Enforcement, which conducted June’s New York raids. She says that the majority of fakes are produced overseas, out of U.S. law enforcement’s jurisdiction, in factories that also produce legitimate goods. Counterfeiters bribe factory owners into letting them use their facilities overnight.

The expanded access has helped counterfeiters broaden their repertoire. Looking over the list of trademark-holder victims from the raids, Ensminger saw “the big boys: Chanel, Coach, Louis Vuitton, but also Baby Phat, Seven for All Mankind, Rocawear, and Red Monkey.” Pat Reilly, a spokesperson for I.C.E., added, “I had to google some of the brands because I’d never heard of them.”

And counterfeiters’ newly sharpened sense of what’s up-and-coming extends far beyond denim. Two ubiquitous purses on Canal Street this summer bear the names of Jimmy Choo, the designer better known for his pricey stilettos, and Kooba, a fledgling handbag brand favored for its simple and durable leather styles. One vendor said that she had completely sold out of a shipment of bogus versions of Kooba’s giant Natasha tote in two weeks.

Both Kooba and Jimmy Choo declined to comment for this story, reflecting a tendency among designers to keep mum on the subject. “It’s an awkward topic,” says Jennifer Pinto, head of public relations for Juicy Couture, another wildly imitated brand. “The only thing I can tell you is that we’re constantly reinventing ourselves and evolving.”

Meaghan Mahoney, one of the two founding members of the Purse Blog, which chronicles and reviews handbag trends, says that faking bags from Kooba and Jimmy Choo is a savvy move by counterfeiters. “These designers are having their bags be seen on countless celebrities and are finding a more secure place in the market, but they’re still not known to everyone,” she says. “Louis Vuitton is one of the most counterfeited brands in the world, and so many people know to expect this. Counterfeiters hope that the younger crowd will be deceived into buying these bags in the hope that they’re getting a real Kooba.”

Even the rareified world of co-branded luxury items, in which two high-end names collaborate on a product, has fallen prey to fraud. Some of Canal Street’s priciest wares right now are $55 replicas of the Breitling for Bentley watch collection. The real thing retails for anywhere from $5,850 to more than $100,000. Breitling manufactures fewer than 200,000 pieces a year and sells them in only 60 to 70 percent of their 340 authorized U.S. retailers. Yet Lisa Roman, head of marketing at Breitling, says that fakes popped up everywhere within a year of the four-year-old collection’s debut. “Our biggest foe is the internet, on which we don’t authorize any sales,” she says. “We take it as a sign of flattery, but it diminishes the integrity of the brand.”

Across the board, small designers agree that constantly shifting is the key to escaping, if not exterminating, copycats. Caleb Westbay, vice president of sales for Ed Hardy, which makes the popular tattoo-inspired T-shirts and trucker hats that overtook Canal Street almost as quickly as they did Melrose Avenue, says, “It sucks, and we take it seriously. But if we move fast enough, they can’t keep up with us.”