Part of the problem here is the international nature of this, Iceburn.
Hasbro could easily flex their corporate muscle if these things were coming out of, say, Delaware. But their ability to do the same in other jurisidictions can be limited. The Chinese government doesn't always care about things such as a copyright and quality control.
They have statutes against this sort of thing, but don't bother enforcing unless it becomes a major embarrassment, as was the case with the recent problems with pet food which killed quite a few dogs in the USA, or Mattel's recent issues with lead in toys.
If it was up to Pawtucket (or the guys in the HQ of TakaraTomy), this sort of thing wouldn't happen, but as long as Beijing has other things to worry about (like trying to find a way to fool the world into thinking that there's no smog in Beijing for a month or so), KOs are likely to keep happening.