CEO who made more than $150 million selling fake Cisco equipment to hospitals, schools, the military and the government receives six-year prison sentence
Onur Aksoy, a US resident, was sentenced to six years and six months in prison for his long-term activities of illegally counterfeiting and selling Cisco products, a company that develops security tools.
Office of Public Affairs | Leader of Massive Scheme to Traffic in Fraudulent and Counterfeit Cisco Networking Equipment Sentenced to Prison | United States Department of Justice
According to the Department of Justice, Aksoy operated at least 19 companies incorporated in New Jersey and Florida, as well as approximately 15 stores on Amazon and approximately 10 sales organizations on eBay (collectively, 'Pro Network Entities'). Through these Pro Network Entities, Aksoy imported tens of thousands of low-quality modified products with counterfeit Cisco labels, stickers, boxes, documents, and packaging from suppliers in China and Hong Kong. They sold them to many military organizations, government agencies, hospitals, schools, and others, including the Department of Defense.
All of the products imported by Aksoy bore Cisco-registered trademarks, making them appear to be genuine, high-quality devices manufactured and licensed by Cisco. However, most of the products were older, lower-quality models, and some were second-hand products that had already been sold or discarded. According to the Department of Justice, Chinese counterfeiters modified these second-hand products to make them look like newer, more expensive products. The counterfeit products also contained components that circumvented Cisco's systems for checking software and authenticating hardware.
The counterfeit products sold by the professional network entities often had numerous performance and safety problems, causing malfunctions and other problems that caused significant damage to users. The counterfeit products were also found to be used in highly confidential locations, such as the government's classified information systems, as well as in many military aircraft owned by the U.S. military, including fighter jets such as F-15s and F-18s.
The estimated total retail value of these devices is hundreds of millions of dollars, with Aksoy himself likely making a personal income of several billion yen.
About 180 of these devices were seized by the Customs and Border Protection from 2014 to 2022, and Aksoy's involvement was known from early on, but Aksoy did not stop trading counterfeit goods. From 2014 to 2019, Cisco sent Aksoy letters warning it to stop selling counterfeit goods. Aksoy responded to at least two letters, but sent back counterfeit documents through its lawyers.
A search of the warehouse took place in 2021, resulting in the seizure of approximately 1,156 counterfeit units. In 2023, Aksoy pleaded guilty to conspiring with others to traffic in counterfeit products, as well as to commit mail and wire fraud.
Aksoy agreed to pay $100 million in damages to Cisco, pay other victims damages to be determined by the court at a later date, and destroy the seized counterfeit products. Aksoy was sentenced to six years and six months in prison.
'This case should serve as a warning to anyone seeking to sell counterfeit goods to the government,' said Special Agent in Charge Greg Gross of the Naval Criminal Investigative Service's (NCIS) Economic Crimes Branch. 'Criminals flooding the supply chain with low-quality equipment from China and Hong Kong harm businesses, pose serious health and safety risks, and threaten national security. This case represents one of the largest counterfeit trademark cases ever prosecuted in the nation,' said Assistant Attorney General Nicole M. Argentieri, Director of the Justice Department's Criminal Division.
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