Four charged in multimillion-dollar counterfeit goods scheme
Seven defendants were charged on Thursday in Brooklyn Federal Court with participating in a counterfeit goods scheme in which they imported generic goods into the United States from China, applied brand labels to those goods in workshops (some of which were controlled by the defendants) and then sold those counterfeit-branded goods to retail and wholesale purchasers.
Among the items they sold were fake UGG boots, Nike Air Jordan sneakers, Timberland boots and Beats headphones.
The charges against the defendants include conspiracy to traffic and trafficking in counterfeit goods and money laundering.
Four of the defendants were arraigned before United States Magistrate Judge Sanket J. Bulsara, and each was released on a $200,000 bond. Three additional defendants remain at large.
The indictment charges that between October 2019 and July 2021, the defendants participated in an international scheme to traffic counterfeit goods. They first imported the goods in generic form from China into the Port of New York and New Jersey. The goods were then delivered to workshops and storage facilities controlled by some of the defendants in Queens and on Long Island.
In those workshops, insignias, emblems, trademarks and other brand signifiers were applied to the generic goods, converting them into purported brand-name merchandise. These counterfeit items were then sold as a part of the scheme directly to consumers and to wholesale buyers.
The estimated retail value of the counterfeit-branded goods, had they been genuine, was in excess of $130 million.
The four defendants who were arraigned in Brooklyn Federal Court, all of whom lived in either Queens or Brooklyn, were identified as Hai Long Zhou, Saiyin Hou, Yan Xue Huang and Jian Fen Yang.
Jacquelyn M. Kasulis, acting United States attorney for the Eastern District of New York; Peter C. Fitzhugh, Special Agent-in-Charge, Homeland Security Investigations, New York; and Dermot Shea, commissioner, NYPD, announced the arrests and indictment.
“As alleged, the defendants trafficked in counterfeit merchandise that they fraudulently branded as genuine to pass off to purchasers in the United States at a purported retail value of more than $130 million,” stated Acting United States Attorney Kasulis. “This office and its law enforcement partners are committed to protecting consumers from paying retail prices for phony merchandise and to holding defendants accountable for their greed.”
The government’s case is being handled by the Office’s General Crimes Section. Assistant United States Attorneys Dylan A. Stern and Benjamin L. Weintraub are in charge of the prosecution. Assistant United States Attorney Tanisha Payne of the Office’s Asset Recovery Section is handling forfeiture matters in the case.
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