Progress Reported Against Traffickers in Counterfeit Network Hardware
March 3, 2008On February 28, Assistant Attorney General Alice S. Fisher of the Criminal Division, Assistant Director James Finch of the FBI’s Cyber Division, Assistant Secretary Julie L. Myers, U.S. Immigration and Customs Enforcement (ICE), Commissioner W. Ralph Basham, U.S. Customs and Border Protection (CBP), and Inspector Peter Goulet of the Royal Canadian Mounted Police (RCMP) announced the results to date of an ongoing international enforcement initiative between the United States and Canada that targets the illegal distribution of counterfeit network hardware manufactured in China.
This ongoing initiative has resulted in more than 400 seizures of counterfeit Cisco network hardware and labels with an estimated retail value of more than $76 million. It is being led by ICE, CBP, and the FBI, working in conjunction with the Criminal Division’s Computer Crime & Intellectual Property Section, U.S. Attorney’s Offices across the country, and the RCMP.
The initiative targets the illegal importation and sale of counterfeit network hardware, in particular network routers, switches, network cards and modules manufactured by Cisco.
“Counterfeit network hardware entering the marketplace raises significant public safety concerns and must be stopped. This initiative shows that through collaboration among law enforcement agencies and prosecutors worldwide, we can achieve dramatic enforcement results and protect public safety,” said Assistant Attorney General Alice S. Fisher of the Criminal Division. “It is critically important that network administrators in both private sector and government perform due diligence in order to prevent counterfeit hardware from being installed on their networks.”
The FBI named its portion of this ongoing initiative Operation Cisco Raider — an international, coordinated investigation of 15 cases involving nine FBI field offices. The FBI worked with law enforcement partners including ICE, Defense Criminal Investigative Service, General Services Administration, Department of the Interior, Internal Revenue Service, and the RCMP. Over the last 2 years, Operation Cisco Raider has resulted in 36 search warrants that identified approximately 3,500 counterfeit network components with an estimated retail value of over $3.5 million, and has led to a total of ten convictions and $1.7 million in restitution.
“This operation illustrates the importance of working closely with our partners in both law enforcement and the private sector,” said FBI Assistant Director James Finch. “Cisco Systems Incorporated specifically deserves praise for their level of cooperation in this initiative. We will continue these efforts to aggressively investigate counterfeit goods in order to protect U.S. consumers and corporations.”
ICE and CBP opened a total of 28 investigations in 17 separate field offices since 2005; eight of those investigations were worked jointly with the FBI, and several were worked with the RCMP. ICE agents have conducted 115 seizures of counterfeit Cisco products having an estimated retail value of $20.4 million. ICE investigations have led to six indictments and four felony convictions to date. CBP has made 373 seizures of counterfeit Cisco network hardware since 2005, and 40 seizures of Cisco labels for counterfeit products. All together, ICE and CBP seized more than 74,000 counterfeit Cisco network components and labels with a total estimated retail value of more than $73 million.
“Crimes like these threaten international commerce, national security and the very safety of our citizens,” said Julie L. Myers, Homeland Security Assistant Secretary for ICE. ‘Throughout this investigation, the cooperation and partnership that we received from Cisco Systems, our law enforcement colleagues, and Chinese counterparts are a clear example of the results that can be realized through industry, interagency and international cooperation.”
“The success of this operation demonstrates our commitment to work jointly with our law enforcement partners, as well as the private sector, to stop international trafficking in counterfeit items and protect our consumers and businesses from these dangerous goods,” stated CBP Commissioner W. Ralph Basham.
In Toronto, Canada, the RCMP has charged two individuals and a company with distributing large quantities of counterfeit network components to companies in the United States via the Internet. The RCMP seized approximately 1,600 pieces of counterfeit network hardware with an estimated value of $2 million. This prosecution resulted from a joint initiative between the RCMP, FBI, ICE, and CBP.
“Counterfeit products greatly undermine the integrity of our economy,” stated Inspector Peter Goulet, Officer in Charge of the RCMP Greater Toronto Area Federal Enforcement Section. “In many cases the end users were unaware that counterfeit products were being placed on their computer networks, and depending on the function of those networks, this could cause serious health and safety concerns.”
