A Miami-based CEO has been arrested for allegedly importing $1 billion worth of counterfeit Cisco equipment from China and then selling it on Amazon and eBay.
The Department of Justice announced(Opens in a new window) today that he charged Onur “Ron” Aksoy, 38, with selling the counterfeit Cisco equipment through numerous online storefronts.
Aksoy allegedly imported tens of thousands of fraudulent Cisco devices from China and Hong Kong. He then set up at least 19 companies in New Jersey and Florida, dubbed the “Pro Network”, to help him resell the material as genuine through e-commerce sites.
One of the sites Aksoy seems to use to sell Cisco equipment.
“The operation reportedly generated more than $100 million in revenue and Aksoy received millions of dollars for personal gain,” the Justice Department said.
The Cisco equipment that Aksoy allegedly sold were usually older, low-end models that had been bought or discarded before. Counterfeiters in China then modified the equipment, making the devices appear as if they were newer or more expensive Cisco product models.
“As alleged, Chinese counterfeiters often added pirated Cisco software and unauthorized, low-quality, or unreliable components, including components to circumvent technological measures Cisco added to the software to verify software license compliance and authenticate the material,” the judge said. says the department. Additionally, the counterfeit products were packaged with authentic-looking labels, boxes, and paperwork.
However, customers who purchased the equipment would later realize that the products were faulty. “Often, they simply crashed or malfunctioned, causing significant damage to their users’ networks and operations — in some cases, costing users tens of thousands of dollars,” the Justice Department said. “Customers of Aksoy’s fraudulent and counterfeit devices included hospitals, schools, government agencies and the military.”
According to the US criminal complaint(Opens in a new window)Aksoy dates back to at least 2013. He was able to buy the counterfeit hardware “95-98%” below the prices of genuine Cisco products.
The counterfeiting has generated numerous complaints from buyers on Amazon and eBay. In response, Amazon and eBay suspended(Opens in a new window) or terminated the showcases on their sites. But Aksoy has repeatedly returned to e-commerce platforms, creating new storefronts under different names between 2014 and 2020.
Cisco was also aware of the counterfeit scheme. From 2014 to 2019, the company sent seven cease-and-desist letters to Aksoy, demanding that he stop the counterfeiting scam.
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Meanwhile, US Customs and Border Protection has seized about 180 shipments that Chinese counterfeiters have attempted to send to Aksoy over the past nine years. In July 2021, US agents also executed a search warrant and raided a warehouse operated by Aksoy, seizing 1,156 counterfeit Cisco devices with a retail value of over $7 million.
To evade investigation, Aksoy sometimes used the pseudonym Dave Durden. But last week, federal investigators arrested Aksoy in Miami on multiple fraud-related charges. As evidence, the criminal complaint against him cites numerous emails and messages that Aksoy and his associates sent to counterfeit suppliers in China.
The Ministry of Justice has cataloged(Opens in a new window) the various storefronts used by Aksoy on Amazon, eBay and its own websites to sell the goods. But for the moment, it is still not known if the victims will receive compensation. Aksoy’s company, Pro Network, did not immediately respond to a request for comment.
In a statement, Cisco said, “We are committed to maintaining the integrity and quality of Cisco products and services. Cisco is grateful to law enforcement and customs officials for their tremendous cooperation in this investigation and to the DOJ for bringing the perpetrator to justice. “
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