Counterfeit Ring Nabbed in New York
After more than a year of investigations, federal authorities in New York charged 29 people with trying to smuggle in more than 950 shipments of fake purses, shoes, watches and apparel through various ports around the country, including Southern California.
Some of that counterfeit material included True Religion blue jeans, made by True Religion Apparel Inc. in Vernon, Calif.; Nike shoes; North Face jackets; Rolex watches; and high-end handbags by Balenciaga, Burberry, Coach, Chanel, Fendi, Gucci, Louis Vuitton and Marc Jacobs. The shipments came through the ports in Long Beach, Calif.; Newark, N.J.; Houston; the New York Container Terminal in Staten Island, N.Y.; and John F. Kennedy International Airport. Most of the shipments came from China and had a street value of $700 million, said U.S. Immigration and Customs Enforcement (ICE), one of the investigating agencies.
Many of the goods were to be sold on the streets of New York City.
“It is really encouraging to know that customs and ICE are involved in operations of this magnitude,” said Deborah Greaves, True Religion’s general counsel. “On the other hand, my feeling is this barely scratches the surface.”
The 29 individuals arrested June 26 in New York and New Jersey were charged in three different complaints for conspiracy to smuggle in merchandise and/or conspiracy to traffic in counterfeit goods. Four of the defendants were also charged with money laundering. Later in the day, the defendants were arraigned in U.S. District Court in Brooklyn, N.Y.
The two investigating units, from U.S. Customs and Border Protection and ICE, used undercover agents, video and audio surveillance, and cooperating witnesses to nail their case in the 19-month investigation. It is ICE’s largest counterfeit bust since the agency’s formation in March 2003.
“Today’s arrests represent our intolerance for criminals who seek to circumvent the legal customs process to smuggle contraband onto our streets,” said Julie L. Myers, assistant secretary of Homeland Security for Immigration and Customs Enforcement, in a statement. “Counterfeiting has risen to the level of an economic pandemic costing the legitimate U.S. economy more than $200 billion annually.”
In fiscal 2006, the government made more than 14,000 seizures of counterfeit goods worth more than $155 million, a 67 percent increase over the previous year.
Schemes uncovered included using fraudulent shipping documents to bring goods in labeled as toys or picture frames, which have lower duties. Corrupt customs brokers got the merchandise into the United States, and the smugglers paid off port officers who were undercover ICE agents, authorities said. Also, some containers were marked for Canada and Mexico, which means they paid no customs duties and were not inspected but remained in the United States, court documents said.
Some of the defendants named were freight forwarders Keung Wong, Chi Wong and Schlomo Greenberg; truckingcompany operators Ronald Depaola and Joseph Depaola; and bonded warehouse owners Phillip McEntee and Joseph Venetucci.
If convicted, the defendants face a maximum five-year prison term for conspiracy charges and 20 years for money laundering. —Deborah Belgum
