Major Customs Bust Nabs 21 on Counterfeiting

BROOKLYN, N.Y. (CN) – Twenty-one people were arrested and set for arraignment Thursday in one of the biggest counterfeit-goods busts in the history of U.S. Customs and Immigration Enforcement.

U.S. Attorney Richard Donoghue said the elaborate scheme resulted involved disguising Chinese-made knockoff handbags and other merchandise as legitimate imports when they made their way into ports on both U.S. coasts.

Court papers note that the luxury brands Louis Vuitton, Coach, Gucci and Tory Burch were among the faked purses, as were Michael Kors wallets, Hermes belts and Chanel perfume. If the goods were real, prosecutors said in total they’d be worth nearly half a billion dollars.

Putting Thursday’s seizure into perspective, Immigrations and Customs Enforcement spokesman Matthew Bourke said in an email that in fiscal year 2017 ICE and Customs and Border Protection seized a total of about $1.2 billion in counterfeit goods.

Assistant Attorney General Brian Benczkowski noted in a statement that counterfeiting deprives legitimate “companies of their valuable and hard-earned intellectual property.”

“The Department of Justice is committed to holding accountable those who seek to exploit our borders by smuggling counterfeit goods for sale on the black market,” Benczkowski added.

The items were brought by ship to the U.S. in 23 different 40-foot shipping containers, according to the U.S. Attorney’s Office. It said one group of defendants, the “importers,” used burner phones and fake email accounts, posing as legitimate importers, and arranged for the goods to be transported by truck to self-storage facilities in Brooklyn, Queens and the rest of Long Island.

A second set of defendants, the “wholesale distributors,” allegedly resold the items to other sellers. The “domestic shippers” used their own private shipping businesses to distribute the sham goods around the country, prosecutors said.

The charges include conspiracy to traffic, and trafficking, in counterfeit goods; conspiracy to smuggle, and smuggling, counterfeit goods into the United States; money laundering conspiracy; immigration fraud and unlawful procurement of naturalization.

“This investigation should be a crystal clear message that counterfeiting and intellectual property rights violations is anything but a victimless crime as it harms legitimate businesses, consumers and governments,” Homeland Security Investigations Special Agent-in-Charge Angel M. Melendez said.

Representatives at Tory Burch, Hermes and Louis Vuitton did not immediately return requests for comment Thursday. Representatives at the U.S. Department of Justice also did not immediately return requests for comment.

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