CEO of Dozens of Companies Pleads Guilty to Selling Fraudulent Cisco Products
A Miami, Florida man who ran numerous companies pleaded guilty to selling fraudulent computer networking equipment to a variety of organizations including government agencies, schools, hospitals, and the military.
Prosecutors say 39-year-old Onur Aksoy, a dual citizen of the United States and Turkey, peddled the fraudulent equipment as Cisco products in a massive scheme. Aksoy ran at least 19 companies along with approximately 15 Amazon storefronts and at least ten eBay storefronts (collectively known as the “Pro Network Entities”) to sell the fraudulent goods. The companies tallied over $100 million in revenue with Aksoy receiving millions of dollars for his personal gain.
Aksoy pleaded guilty to conspiring with others to traffic in counterfeit goods, to commit mail fraud, and to commit wire fraud, and to a count of mail fraud.
Counterfeit Operation Traced to China
The Department of Justice (DOJ) says the Pro Network Entities imported tens of thousands of “low-quality, modified computer networking devices with counterfeit Cisco labels, stickers, boxes, documentation, and packaging” from China and Hong Kong. The counterfeit goods also had Cisco trademarks that “made the goods falsely appear to be new, genuine, and high-quality devices manufactured and authorized by Cisco.”
In actuality, the devices were older, lower-model products which Chinese counterfeiters modified to appear as genuine Cisco products, adding in stolen Cisco software and components designed to circumvent Cisco measures to check for software license compliance.
DOJ says the counterfeit products had numerous performance, functionality, and safety problems and would often “simply fail or otherwise malfunction, causing significant damage to their users’ networks and operations — in some cases, costing users tens of thousands of dollars.”
CBP Seizes Shipments
DOJ says that approximately 180 shipments of counterfeit Cisco products being shipped to the Pro Network Entities were seized by U.S. Customs and Border Protection (CBP) between 2014 and 2022.
In response to the seizures, prosecutors say Aksoy falsely submitted official papers to CBP under an alias that he used to communicate with co-conspirators in China. Those co-conspirators then tried to avoid CBP detection by breaking up shipments into smaller parcels and shipping them on different days to fake delivery addresses.
In addition, Cisco sent seven letters to Aksoy asking him to cease and desist trafficking of the counterfeit goods. On at least two occasions, Aksoy responded to the letters by causing his attorney to provide Cisco with forged documents.
In July 2021, agents seized 1,156 counterfeit Cisco devices with a retail value of more than $7 million from Aksoy’s warehouse.
Sentencing is November 6, 2023, and under a pending plea agreement, Aksoy faces four to six and a half years in prison and must forfeit $15 million in illicit gains and make full restitution to victims.