Feds shred counterfeit Cisco trade

Counterfeit Cisco network hardware sting chalks up 30 convictions, 700 hardware seizures

With a new conviction today, the federal action known as Operation Network Raider has resulted in 30 felony convictions and more than 700 seizures of counterfeit Cisco network hardware with an estimated value of more than $143 million. 

According to the Departments of Justice and Homeland Security who headed up the operation, there has been a 75% decrease in seizures of counterfeit network hardware at US borders from 2008 to 2009. In addition, nine people are facing trial and another eight defendants are awaiting sentencing.

The US Customs and Border Protection (CBP) has made 537 seizures of counterfeit Cisco network hardware since 2005, and 47 seizures of Cisco labels for counterfeit products. In total, ICE and CBP seized more than 94,000 counterfeit Cisco network components and labels with a total estimated retail value of more than $86 million during the course of the operation, the agency added. 

The agencies said that today, Ehab Ashoor, 49, a Saudi Citizen who resides in Sugarland, Texas, was sentenced in the Southern District of Texas to 51 months in prison and ordered to pay $119,400 in restitution to Cisco. A federal jury found Ashoor guilty on Jan. 22, 2010, of charges related to his trafficking in counterfeit Cisco products. According to evidence presented at trial, Ashoor purchased counterfeit Cisco Gigabit Interface Converters (GBICs) from an online vendor in China with the intention of selling them to DoD.  The computer network for which the GBICs were intended is used by the U.S. Marine Corps to transmit troop movements, relay intelligence and maintain security for a military base west of Fallujah, Iraq, the DoJ stated.

"Trafficking in counterfeit computer components is a problem that spans the globe and impacts most, if not all, major network equipment manufacturers. As this operation demonstrates, sustained cooperation between law enforcement and the private sector is often a critical factor in disrupting and dismantling criminal organizations that threaten our economy and endanger public safety," said Assistant Attorney General Breuer in a statement.    

The FBI was also part of the operation's success and worked closely with the US Immigration and Customs Enforcement (ICE), Defense Criminal Investigative Service, General Services Administration, Department of Interior, Internal Revenue Service and the Royal Canadian Mounted Police. During the last four years as part of Operation Network Raider and Cisco Raider, the FBI has executed 36 search warrants seizing counterfeit network components with an estimated retail value of more than $7 million, according to the DoJ. 

The operation was also aided by the DoJ's recently established  intellectual property task force that is focusing on battling US and international intellectual property crimes. 

The Task Force works across a number of agencies including the FBI and will focus on bolstering efforts to combat intellectual property crimes through close coordination with state and local law enforcement partners as well as international counterparts, the DoJ stated. It will also monitor and coordinate overall intellectual property enforcement efforts at the DoJ, with an increased focus on the international IP enforcement, including the links between IP crime and international organized crime. The Task Force will also develop policies to address what the DoJ called evolving technological and legal landscape of this area of law enforcement.

In April the FBI and DoJ appointed 15 new Assistant US Attorney  (AUSA) positions and 20 FBI Special Agents dedicated to fighting domestic and international IP crimes.   

The 15 AUSA's work closely with the Criminal Division's Computer Crime and Intellectual Property Section to aggressively pursue high tech crime, including computer crime and intellectual property offenses.   The new positions will be located in California, the District of Columbia, Maryland, Massachusetts, Michigan, New Jersey, New York, Pennsylvania, Texas, Virginia and Washington, the DoJ stated.    

The 20 FBI Special Agents will be deployed to specifically boost four geographic areas with intellectual property squads, and increase investigative capacity in other locations around the country where intellectual property crimes are of particular concern, the FBI said.  The four squads will be located in New York, San Francisco, Los Angeles and the District of Columbia.  

Counterfeit electronics is big business.  From November 2007 to present, CBP and ICE have made more than 1,300 seizures involving 5.6 million counterfeit semiconductor devices. More than 50 seized counterfeit shipments were falsely marked as military or aerospace grade devices. Shipments of seized semiconductors were affixed with counterfeit trademarks from 87 North American, Asian and European semiconductor companies and were destined for importers in the United States and 15 other countries, the DoJ stated. 

Follow Michael Cooney on Twitter: nwwlayer8   

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