Three New Jersey men pleaded guilty to trafficking millions of dollars’ worth of fake computer networking equipment, according to authorities.

Musa Karaman, 35, of North Arlington, entered a guilty plea Aug. 24 in Trenton federal court on one count of trafficking in counterfeit goods, while Sadri Ozturan, 37, of Hawthorne, and Israfil Demir, 38, of Secaucus, each pleaded guilty Aug. 9 to trafficking in counterfeit goods, U.S. Attorney Philip Sellinger said in a news release. 

According to the U.S. Attorney’s Office, between September 2017 through May 2021, Karaman, Demir and Ozturan formed and operated numerous entities selling computer networking gear, including devices manufactured by Cisco Systems Inc., a major U.S. technology conglomerate.

Although advertised as new and genuine, the products were counterfeit devices the trio procured from various overseas suppliers – most of which were in China – at well below market cost and resold at higher prices, authorities said.

According to court filings, most of the products sold by the men were through MIS Enterprise, a Woodland Park-based operation “that purported to be in the business of, among other things, selling genuine, high-quality computer networking equipment.” However, Karaman, Demir and Ozturan also used various shell companies that they either owned or controlled to sell products imported from illicit suppliers, court documents said.

Over the course of the long-running scheme, the three men wired at least $1.2 million in payments overseas for the bogus devices and kept a “significant inventory” at MIS’ warehouse.

After federal agents executed a search warrant in May 2021 of the facility, they discovered 7,260 counterfeit Cisco devices worth about $13.77 million.

At the time, Cisco told law enforcement officials it was one of the largest volumes of counterfeit Cisco products ever seized and the total value was “unprecedented.” 

Overall, between September 2017 and May 2021, U.S. Customs and Border Protection seized approximately $3.8 million in fake Cisco technology that was sent by Chinese suppliers to various locations under the control of Karaman, Demir and Ozturan, including their warehouse and home addresses, often under bogus names.

Despite being notified of each of the 20 seizures, the men continued to procure bogus Cisco products from the same providers, court filings said.

Sentencing for Ozturan will be Dec. 13 and for Demir Dec. 14. Karaman is scheduled for sentencing Jan. 4, 2024. Each faces up to 10 years in prison and a maximum fine of $2 million, according to Sellinger.

A collaborative effort

The guilty pleas reportedly stemmed from an investigation prompted by a referral from Cisco and Amazon’s Counterfeit Crimes Unit (CCU). 

In a statement, Kebharu Smith, director of Amazon‘s CCU, said the outcome is “a testament to what we are able to accomplish when brands, law enforcement and Amazon work together.”

“Counterfeiters are beginning to see that if you attempt to defraud brands, Amazon, or our customers, the consequences are severe. We continue to express our gratitude for the collaboration with Cisco and the work of the Department of Justice,” Smith said.

This follows a previous action from Amazon’s CCU to hold fraudsters accountable. In June, the chief executive officer of dozens of companies in New Jersey and Florida pleaded guilty to selling $1 billion worth of fake Cisco networking equipment that was illegally imported from China.

According to authorities, Onur Aksoy, a joint U.S. citizen and Turkish national, set up at least 15 storefronts on Amazon, 10 on eBay, and 19 companies established in New Jersey and Florida to sell counterfeit products.

Through his “Pro Network Entities” venture, which had been operating since at least 2013, Aksoy imported tens of thousands of fake Cisco networking devices from China and Hong Kong and resold them to customers – including hospitals, schools, government agencies and the military – both in the U.S. and overseas, according to authorities.

Under the terms of a plea agreement that the court conditionally accepted, Aksoy would receive a prison term of four to six years, forfeit $15 million in illicit gains and make full restitution to his victims.

He is scheduled to return to court for sentencing Nov. 6.