A federal grand jury has indicted a Florida man for allegedly orchestrating a scheme over many years to traffic in counterfeit Cisco networking equipment with an estimated retail value of over $1 billion, Attorney for the United States Vikas Khanna, District of New Jersey, and Assistant Attorney General Kenneth A. Polite announced today.
According to federal officials, Onur Aksoy, aka “Ron Aksoy” and “Dave Durden,” 38, of Miami, Florida, is charged by indictment, returned July 7, 2022, with conspiracy to traffic in counterfeit goods and to commit mail and wire fraud, mail fraud, wire fraud and trafficking in counterfeit goods.
According to documents filed in this case and statements made in court:
Aksoy allegedly ran at least 19 companies formed in New Jersey and Florida as well as at least 15 Amazon storefronts, at least 10 eBay storefronts, and multiple other entities (collectively, the “Pro Network Entities”) that imported tens of thousands of fraudulent and counterfeit Cisco networking devices from China and Hong Kong and resold them to customers in the United States and overseas, falsely representing the products as new and genuine.
The operation allegedly generated over $100 million in revenue, and Aksoy received millions of dollars for his personal gain.
The devices the Pro Network Entities imported from China and Hong Kong were typically older, lower-model products, some of which had been sold or discarded, which Chinese counterfeiters then modified to appear to be genuine versions of new, enhanced, and more expensive Cisco devices.
The Chinese counterfeiters often added pirated Cisco software and unauthorized, low-quality, or unreliable components – including components to circumvent technological measures added by Cisco to the software to check for software license compliance and to authenticate the hardware.
To make the devices appear new, genuine, high-quality, and factory-sealed by Cisco, the Chinese counterfeiters allegedly added counterfeited Cisco labels, stickers, boxes, documentation, packaging, and other materials.
The fraudulent and counterfeit products sold by the Pro Network Entities suffered from numerous performance, functionality, and safety problems.
Often, they would simply fail or otherwise malfunction, causing significant damage to their users’ networks and operations – in some cases, costing users tens of thousands of dollars.
Customers of Aksoy’s fraudulent and counterfeit devices included hospitals, schools, government agencies, and the military.
As set forth in the indictment, between 2014 and 2022, Customs and Border Protection (CBP) seized approximately 180 shipments of counterfeit Cisco devices being shipped to the Pro Network Entities from China and Hong Kong.
In response to some of these seizures, Aksoy allegedly falsely submitted official paperwork to CBP under the alias “Dave Durden,” an identity that he used to communicate with Chinese conspirators.
To try to avoid CBP scrutiny, Chinese conspirators allegedly broke the shipments up into smaller parcels and shipped them on different days, and Aksoy used at least two fake delivery addresses in Ohio.
After CBP seized a shipment of counterfeit Cisco products to Aksoy and the Pro Network Entities and sent a seizure notice, Aksoy allegedly often continued to order counterfeit Cisco products from the same supplier.
From 2014 to 2019, Cisco sent seven letters to Aksoy asking him to cease and desist his trafficking of counterfeit goods.
Aksoy allegedly responded to at least two of these letters by causing his attorney to provide Cisco with forged documents. In July 2021, agents executed a search warrant at Aksoy’s warehouse and seized 1,156 counterfeit Cisco devices with a retail value of over $7 million.
Anyone who believes they may be a victim of Aksoy or the Pro Network Entities, please visit www.justice.gov/largecases or https://edit.justice.gov/usao-nj/united-states-v-onur-aksoy-pro-network for more information.
The Pro Network Entities include at least the following: