22 Charged with Smuggling Millions of Dollars of Counterfeit Luxury Goods from China into The United States

Earlier today, in federal court in Brooklyn, six indictments and one criminal complaint were unsealed 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.  The defendants were arrested this morning, and their initial appearances and arraignments are scheduled this afternoon before United States 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.

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

“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,” stated United States 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.”  Mr. Donoghue extended his grateful appreciation to the HSI Intellectual Property Group and the HSI Border Enforcement Security Task Force and the NYPD.  Mr. Donoghue also extended his thanks to U.S. Customs and Border Protection, the New York State Police and the Brooklyn District Attorney’s Office for their assistance.

“The defendants allegedly smuggled millions of dollars of counterfeit luxury goods into our country, depriving companies of their valuable and hard-earned intellectual property,” stated 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.”

“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 north of 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.”

“Today’s indictments demonstrate our resolve to ensure a level playing field for all, and serve as a reminder that selling fake goods is never a victimless crime,” stated NYPD Commissioner O’Neill.  “Everything about these activities undermines public trust. And the NYPD, in close collaboration with all of our local, state, and federal law enforcement partners, will continue to aggressively combat and prosecute the evasive practices of the individuals and companies who attempt to operate outside our laws and regulations.”

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.

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 unless and until proven guilty.

The government’s cases are being prosecuted by Assistant United States Attorneys William P. Campos and Temidayo Aganga-Williams of the Eastern District of New York, Special Assistant United States Attorney Robert Kaftal of the Brooklyn District Attorney’s Office and Senior Counsel James S. Yoon of the U.S. Department of Justice, Criminal Division Computer Crime and Intellectual Property Section (CCIPS).  Assistant United States 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.  For more information about the U.S. Attorney’s Office for the Eastern District of New York, visit its website at https://www.justice.gov/usao-edny. 

The Defendants:

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

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

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

JOSSTINA LIN (also known as “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 (also known as “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 (also known as “Linda”)
Age: 53
Nassau County, New York

QIONG CHAN MU (also known as “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 (DLI)

YONG LIN DONG
Age: 43
Queens, New York

CAI YING LIN
Age: 43
Queens, New York

CHENG XU YU (also known as “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 (also known as “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