US grabs more domain names, $896,000 in fake goods

Paypal accounts, Chinese banks part of scheme

The US Department of Justice this week said it seized nearly $896,000 and seven domain names from online sites it said were selling counterfeit goods.

According to court documents, the DoJ said individuals conducted sales and processed payments for the counterfeit goods using PayPal Private Ltd. accounts and then wired their proceeds to bank accounts held at Chinese banks.  Under warrants issued by a US District Judge, law enforcement agents seized $826,883 in proceeds that had been transferred from PayPal accounts to various bank accounts in China.  The funds were seized from correspondent, or interbank, accounts held by the Chinese banks in the United States, the DoJ stated.

More: The fierce battle for intellectual property

Under additional seizure warrants issued by a US Magistrate Judge, enforcement agents from the Department of Homeland Security's Immigration and Customs Enforcement (ICE) and National Intellectual Property Rights Center and ICE-HSI also grabbed $69,504 in funds remaining in three PayPal accounts used by the people involved.

The investigation is a product of an ongoing initiative known as "Operation In Our Sites," which the DOJ says targets online commercial intellectual property crime.  Operation In Our Sites targeted online retailers of an array of counterfeit goods, including sports equipment, shoes, handbags, athletic apparel, sunglasses and DVD boxed sets.  To date, the investigation has claimed 758 domain names of websites engaged in the sale and distribution of counterfeit goods and illegal copyrighted works, the DoJ stated. 

The bust comes not long after 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.

Background: Is EVERYTHING made in China?

Sixteen of the sites the agency shut down during this operation known as Fake Sweep, were illegally streaming live sporting telecasts over the Internet, including NFL games. Two hundred ninety-one website domain names were illegally selling and distributing counterfeit merchandise, ICE stated.

Counterfeit merchandise seized included fake jerseys, ball caps, t-shirts, jackets and other football souvenirs.  During this operation, an additional 22,570 items of counterfeit merchandise and clothing representing other sports leagues, including Major League Baseball, National Basketball Association and National Hockey League were seized by law enforcement. In total, this operation netted 65,262 counterfeit items worth $6.4 million, ICE stated.

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