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US grabs more domain names, $1.4 million from online counterfeit operations

Department of Justice takes out online counterfeiters doing business from China

By Layer 8 on Fri, 05/11/12 - 12:31pm.

The Department of Justice today said it snatched up more than $1.5 million from the distribution of counterfeit sports apparel and jerseys being sold online.

According to court documents, investigation by federal law enforcement agents revealed that subjects whose domain names had been seized in a November 2010 In Our Sites operation continued to sell counterfeit goods using new domain names. In particular, the individuals, based in China, sold counterfeit professional and collegiate sports apparel, primarily counterfeit sports jerseys.

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Law enforcement agents made numerous undercover purchases from the websites associated with the new domain names. After the goods were confirmed to be counterfeit or infringing, seizure warrants for three domain names used to sell the infringing goods were obtained from a U.S. Magistrate Judge in U.S. District Court for the District of Columbia, the DoJ stated.

The individuals conducted sales and processed payments for the counterfeit goods using money service business accounts and then wired their proceeds to bank accounts held at a Chinese bank, the court documents state. Under warrants issued by a U.S. District Judge, law enforcement agents seized $1,455,438.72 in proceeds that had been transferred from the money service business accounts to various bank accounts in China. The funds were seized from correspondent, or interbank, accounts held by the Chinese bank in the United States. Under additional seizure warrants issued by a U.S. Magistrate Judge, law enforcement agents also seized $94,730.12 in funds remaining in six money service business accounts used by the subjects, the DoJ stated.

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The online counterfeit bust is the third major one since January. You may recall in April the DoJ and Department of Homeland Security's Immigration and Customs Enforcement (ICE) said it seized nearly $896,000 and seven domain names from online sites it said were selling counterfeit goods. In February the DoJ and ICE seized 307 websites and snatched up 42,692 items of phony Super Bowl-related memorabilia along with other counterfeit items for a total take of more than $4.8 million.

The busts are part of the government's Operation In Our Sites, which targets online commercial intellectual property crime. To date, 761 domain names of websites used in the sale and distribution of counterfeit goods and illegal copyrighted works have been seized as a result of Operation In Our Sites, the DoJ stated.

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