Suspected counterfeit ring broken up in New Jersey

By Shan Li

March 5, 2012 12 AM PT

More than two dozen people were charged in a $325-million counterfeit ring to import knockoffs from China and Taiwan through a port in New Jersey, authorities said.

Using undercover agents and wiretaps, federal law enforcement agencies uncovered “two elaborate schemes” to elude border security and transport counterfeit apparel, accessories, cigarettes and illegal drugs into the Newark-Elizabeth Marine Terminal, the U.S. district attorney’s office in New Jersey said in a statement.

Items included over $25 million worth of counterfeit Nike sneakers, Ugg boots, and fake Burberry, Louis Vuitton, Coach and Gucci handbags, along with other fashion items. The suspected counterfeiters tried to elude detection by placing generic lids and labels on products to hide the fake brand names underneath; once the items cleared the ports, the labels would be cut off to reveal the counterfeit ones below, authorities said.

The counterfeit sting also unearthed a related effort to smuggle crystal methamphetamine into the country, authorities said.

“The cost of counterfeit goods is not limited to massive financial harm to American businesses and consumers,” U.S. Atty. Paul J. Fishman said in a statement. “Criminals can exploit the same channels to import other material that threatens our health and safety.”

Authorities say they caught the counterfeiting suspects discussing whether to expand into other consumer goods, including knockoff cosmetics. During one conversation recorded in Dec. 2010, one defendant allegedly assured another that the makeup was “counterfeit, but of good quality.”

When asked whether the items may be harmful when applied, the person allegedly replied: “All I care about is to make money, other things do not matter.”

Of the 29 people indicted on Friday, 23 are being held in federal custody. Six remain at large.

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