The DOJ on Friday announced the arrest of Jianhua Li, a Chinese national living in the United States who, over a period of nearly five years, participated in a massive iPhone and iPad counterfeiting operation that netted him more than $1.1 million in proceeds.
According to a press release from the DOJ, Li worked with a small group of people who smuggled in sophisticated iOS counterfeits bearing the same look and feel of authentic Apple products, right down to the appropriate trademarks and Apple-style packaging. Li pled guilty and will be handed down a sentence on May 30.
The counterfeit scheme reportedly began in July of 2009 and was in operation all the way through February of 2014.
Mr. Li, working through his company Dream Digitals, conspired with Andreina Becerra, Roberto Volpe, Rosario LaMarca, and others to smuggle and traffic into the United States from China more than 40,000 electronic devices and accessories, including iPads and iPhones, along with labels and packaging bearing counterfeit Apple trademarks. Mr. Li also received payments totaling over $1.1 million in sales proceeds from U.S. accounts into his bank accounts.
The DOJ further details how Li, for a time, managed to avoid being caught by U.S. Customs officials.
Mr. Li shipped devices separately from the labels bearing counterfeit trademarks for later assembly to avoid detection by U.S. Customs and Border Protection officials. The devices were then shipped to conspirators all over the United States. Proceeds from the sales of the devices were funneled back to the co-conspirators’ accounts in Florida and New Jersey via structured cash deposits and a portion of the proceeds was then transferred to conspirators in Italy, further disguising the source of the funds.
Though seemingly not as big of an issue as it once was, trafficking in counterfeit Apple products was a huge business just a few years ago. If you recall, Chinese authorities back in 2015 famously shut down a factory responsible for churning out upwards of 41,000 fake iPhones with a value totaling an estimated $19 million. At this point, it remains unclear if there is a connection between the two stories.
