Financial Fraud: 22 Defendants Charged With Conspiracy to Traffic in Counterfeit Goods, Smuggling, Money Laundering, Immigration Fraud



Financial Fraud
22 Charged With Smuggling Millions of Dollars of Counterfeit Luxury Goods From China Into the United States

22 Charged With Smuggling Millions of Dollars of Counterfeit Luxury Goods From China Into the United States

Defendants Trafficked Items that Included Fake Louis Vuitton and Tory Burch Handbags, Michael Kors Wallets, Hermes Belts and Chanel Perfume

Earlier today, six indictments and one criminal complaint were unsealed in federal court in Brooklyn, New York, charging a total of 22 defendants with illegally bringing into the United States millions of dollars of Chinese-manufactured goods by smuggling them through ports of entry on the East and West Coasts. One defendant is also charged with unlawful procurement of naturalization. Twenty-one defendants were arrested this morning, and their initial court appearances and arraignments are scheduled before U.S. Magistrate Judge Lois Bloom.

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. In addition, the government restrained nine real properties in Queens, Staten Island and Brooklyn, New York belonging to the defendants.

Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Richard P. Donoghue for the Eastern District of New York, Special Agent in Charge Angel M. Melendez of U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) New York and Commissioner James P. O’Neill of the New York City Police Department (NYPD), announced the charges.

“The defendants allegedly smuggled millions of dollars of counterfeit luxury goods into our country, depriving companies of their valuable and hard-earned intellectual property,” said Assistant Attorney General Benczkowski. “The illegal smuggling of counterfeit goods poses a real threat to honest businesses, and I commend our federal prosecutors and partners at HSI and the NYPD for their outstanding work on this important investigation. 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.”

“As alleged, the defendants used many forms of deception to smuggle large quantities of counterfeit luxury brand goods from China into the United States, and then profited by distributing and selling the fake merchandise,” said U.S. Attorney Donoghue. “This Office, working with our law enforcement partners, is committed to securing our country’s ports of entry, as well as to protecting the integrity of intellectual property upon which free and fair international trade and markets depend.”

“This investigation exposed the global nature of intellectual property crimes, allegedly being executed by those arrested today. Counterfeit goods manufactured and smuggled from China with a suggested value close to half a billion dollars, were intended to make its way into U.S. markets and into the hands of unsuspecting consumers,” said HSI Special Agent-in-Charge Melendez. “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.”

According to the court filings, the defendants played various roles in the trafficking of counterfeit goods manufactured in China, brought by ocean-going ships to the United States in 40-foot shipping containers, smuggled through ports of entry disguised as legitimate imports and distributed throughout the country. The counterfeit goods included items such as fake Louis Vuitton and Tory Burch handbags, Michael Kors wallets, Hermes belts and Chanel perfume. The defendants’ roles included:

Importers

Qi Feng Liang, Wo Qi Liu, Zhi Ming Zhang and Yu Ming Wong served as shipping container importers. They arranged to smuggle counterfeit goods into the United States through the Port of New York/New Jersey and elsewhere. They fraudulently used the names, addresses and other identifying information of legitimate import companies and falsified the descriptions of the containers’ contents on U.S. customs paperwork associated with the containers of counterfeit goods. They used “burner” phone numbers and “burner” email accounts—obtained by using false or incomplete information—in order to conceal their true identities. The counterfeit goods were transported by trucks to self-storage facilities in Brooklyn, Queens and Long Island, New York, where the goods were unloaded and stored. Qi Feng Liang, Wo Qi Liu, Zhi Ming Zhang and Yu Ming Wong smuggled or attempted to smuggle 23 40-foot shipping containers into the country loaded with counterfeit items. The estimated Manufacturers’ Suggested Retail Price of these items, had they been genuine, would have been more than $450 million.

Wholesale Distributors

Josstina Lin, Xue Wei Qu, Xi Quan Huang, Yun Lei Huang, Yun Wu Huang, Si Lung Chung, Le Wei Zheng, Xiao Ying Huang, Qiong Chan Mu, Ren Zhong Zhu, Cheng Xu Yu, Jin Hua Zhang, Jian Hua Zhu, Yong Lin Dong and Cai Ying Lin managed the receipt, storage and distribution of counterfeit goods smuggled into the United States by the importers. They resold the counterfeit items to other wholesale and retail sellers in New York, California and elsewhere in the United States.

Domestic Shippers

Wei Mei Gao, Sheng Miao Xia and Jie Mei Chen used private shipping businesses they controlled to distribute the counterfeit goods smuggled into the United States by the importers and handled by the wholesale distributors. The domestic shippers also facilitated payments by the wholesale and retail counterfeit goods sellers to the wholesale distributors. Jie Mei Chen is also charged with unlawful procurement of naturalization.

As alleged in the indictments, some defendants additionally conspired to launder the proceeds from the sale of counterfeit goods, and others illegally concealed their involvement in the trafficking of counterfeit goods when applying for immigration benefits.

The charges in the indictments and criminal complaint are allegations, and the defendants are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

The investigation was conducted by HSI Intellectual Property Group and HSI Border Enforcement Security Task Force and the NYPD Border Security Enforcement Task Force. Assistance was provided by U.S. Customs and Border Protection, the New York State Police and the Brooklyn District Attorney’s Office. The government’s cases are being prosecuted by Senior Counsel James S. Yoon of the Criminal Division’s Computer Crime and Intellectual Property Section (CCIPS), Assistant U.S. Attorneys William P. Campos and Temidayo Aganga-Williams of the Eastern District of New York and Special Assistant U.S. Attorney Robert Kaftal of the Brooklyn District Attorney’s Office. Assistant U.S. Attorney Claire S. Kedeshian is handling the forfeiture aspect of this case. The investigation was previously led by Senior Counsel Evan Williams of CCIPS.

The Department of Justice’s Task Force on Intellectual Property (IP Task Force) contributed to this case. The IP Task Force is led by the Deputy Attorney General to combat the growing number of domestic and intellectual property crimes, to protect the health and safety of American consumers and to safeguard the nation’s economic security against those who seek to profit illegally from American creativity, innovation and hard work. To learn more about the IP Task Force, go to https://www.justice.gov/iptf.

The Defendants:

QI FENG LIANG (aka “Alex” and “Mike Sotire”)
Age: 34
Brooklyn, New York

WO QI LIU (aka “Louis,” “Qi,” “Woqi” and “Big Elephant”)
Age: 43
Brooklyn, New York

ZHI MING ZHANG (aka “Jordan” and “Four B”)
Age: 43
Staten Island, New York

JOSSTINA LIN (aka “Tina”)
Age: 42
Brooklyn, New York

XUE WEI QU
Age: 51
Queens, New York

E.D.N.Y. Docket No. 18-CR-419 (WFK)

XI QUAN HUANG
Age: 58
Queens, New York

YUN LEI HUANG
Age: 32
Queens, New York

YUN WU HUANG
Age: 34
Queens, New York

WEI MEI GAO
Age: 35
Queens, New York

SHENG MIAO XIA
Age: 44
Queens, New York

E.D.N.Y. Docket No. 18-CR-408

SI LUNG CHUNG (aka “Allan”)
Age: 42
New York, New York

LE WEI ZHENG
Age: 42
New York, New York

E.D.N.Y. Docket No. 18-CR-407 (CBA)

XIAO YING HUANG (aka “Linda”)
Age: 53
Nassau County, New York

QIONG CHAN MU (aka “Rosanna”)
Age: 26
Nassau County, New York

REN ZHONG ZHU
Age: 31
Nassau County, New York

E.D.N.Y. Docket No. 18-CR-423 (JBW)

YONG LIN DONG
Age: 43
Queens, New York

CAI YING LIN
Age: 43
Queens, New York

CHENG XU YU (aka “Vic”)
Age: 29
Queens, New York

JIAN HUA ZHU
Age: 52
Queens, New York

JIN HUA ZHANG
Age: 55
Queens, New York

E.D.N.Y. Docket No. 18-CR-396 (JBW)

JIE MEI CHEN (aka “Jenny”)
Age: 33
Queens, New York

E.D.N.Y. Docket No. 18-CR-409 (BMC)

YU MING WONG
Age: 36
Queens, New York

E.D.N.Y. Docket No. 18-MJ-752



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