ICE and CBP's "Operation Red Zone" Seizes $13.6 Million Worth of Counterfeit NFL Merchandise

Speaking at a National Football League (NFL) news conference Thursday, January 31, 2013, U.S. Immigration and Customs Enforcement (ICE) Director John Morton and NFL Vice President for Legal Affairs Anastasia Danias announced the record-breaking results of a nationwide enforcement operation. The initiative, dubbed 'Operation Red Zone,' commenced Sept. 1, 2012, and targeted international shipments of counterfeit merchandise as it entered the United States. Authorities targeted warehouses, stores, flea markets, online vendors and street vendors selling counterfeit game-related sportswear and tickets throughout the country.

Fake jerseys, ball caps, T-shirts, jackets and other souvenirs are among the counterfeit merchandise and clothing confiscated by teams of special agents and officers from ICE's Homeland Security Investigations (HSI), U.S. Customs and Border Protection (CBP), U.S. Postal Inspection Service, and state and local police departments around the country - all in partnership with the NFL and other major sports leagues.

"The Super Bowl is one of the nation's most exciting events. Organized criminals are preying on that excitement, ripping consumers off with counterfeit merchandise and stealing from the American businesses who have worked hard to build a trusted brand," said Morton. "The sale of counterfeit jerseys and other sports items undermines the legitimate economy, takes jobs away from Americans and fuels crime overseas. No good comes of counterfeiting American products - whether NFL jerseys, airbags, or pharmaceuticals - and we must go after the criminals behind it."

'Hard goods' seizures

Special agents from HSI and officers with CBP operated in multiple teams with the NFL and law enforcement agencies throughout the nation to identify illegal shipments imported into the U.S., as well as stores and vendors selling counterfeit trademarked items. With only days left before Super Bowl XLVII, these teams have already seized more than 160,000 items of phony Super Bowl-related memorabilia along with other counterfeit items for a total take of more than $13.6 million. Due to the increased activity of counterfeiting operations around the world, this year the operation began Sept. 1, 2012, and will continue through Feb. 6, 2013.

"We're delighted to once again partner with federal law enforcement to help combat the influx of counterfeit merchandise," said Danias. "We are grateful for their tireless efforts to keep counterfeiters from illegally profiting off of the fans' enthusiasm for their team and the Super Bowl and from hurting the local businesses that play by the rules."

"In collaboration with the NFL and our (Department of Homeland Security) partners, we are providing critical support in the effort to protect consumers from counterfeit goods," said Robert C. Gomez, director of field operations in Atlanta and New Orleans for CBP. "The enforcement of iintellectual property rights is a national agency priority, and our CBP officers and import specialists are actively working to intercept these products. Counterfeit merchandise hurts our economy and, in many cases, presents safety issues. It is a potential source of funding illegal activities that present a threat to our national security."

Arrests

In September 2012, HSI Boston - assisted by HSI Providence - executed a search warrant at a residence in Warwick, R.I. HSI seized 226 boxes of counterfeit goods containing 4,016 sports jerseys with a manufacturer's suggested retail price (MSRP) of $724,340 and approximately $477,000 worth of additional counterfeit goods, as well as $130,057 in U.S. currency and checks. The owner of the home was subsequently arrested and is currently facing federal charges of trafficking in counterfeit goods and smuggling.

In November 2012, HSI Indianapolis special agents responded to a call from Indiana State Fairgrounds Security that an individual at the Indianapolis International Fest was selling items suspected to be counterfeit. Upon arriving at the festival, the special agents were able to verify the goods to be counterfeit and seized 1,319 counterfeit sports ball caps from the individual with an MSRP of $30,095 and approximately $7,600 worth of additional counterfeit goods. HSI arrested the man for illegally trafficking in counterfeit merchandise. 

Twenty-one other individuals were arrested in partnership with state and local law enforcement
agencies on state charges at locations around the country.

Website seizures

Furthering HSI's efforts to combat the international counterfeiting supply chain and piracy online, special agents seized a total of 313 websites identified to be selling counterfeit merchandise.

The website seizures during Operation Red Zone are the next iteration of Operation In Our Sites, a long term law enforcement initiative targeting counterfeiting and piracy on the Internet. The 313 websites have been seized by law enforcement, and are now in the custody of the federal government. Visitors to these websites will find a seizure banner that notifies them that the domain name has been seized by federal authorities and educates them that willful copyright infringement is a federal crime. Since the launch of Operation In Our Sites in June 2010, the ICE HSI-led Intellectual Property Rights (IPR) Center has seized a total of 2,061 domain names.

HSI has continued to work closely with payment processor PayPal to identify bank accounts being used to facilitate the transfer of money to these illegal operations. To date, PayPal and HSI have identified and seized more than $66,000 in assets in these accounts.

"PayPal and eBay Inc. pride ourselves in going above and beyond in the fight against the illegal online trafficking of counterfeit goods by partnering with law enforcement and rights owners globally, and as part of providing safe and trusted payments and commerce platforms," said Tod Cohen, eBay's vice president and deputy general counsel of government relations.

Operation Red Zone continues

Operation Red Zone will continue this weekend at the Super Bowl, throughout the New Orleans-area and around the nation.

The operation was spearheaded by the IPR Center in coordination with the Department of Justice's Computer Crime and Intellectual Property Section and five U.S. Attorneys' Offices, including the District of Maryland, District of New Jersey, District of Colorado, Eastern District of Louisiana and the District of Utah.

The IPR Center is one of the U.S. government's key weapons in the fight against criminal counterfeiting and piracy. Working in close coordination with the Department of Justice Task Force on Intellectual Property, the IPR Center uses the expertise of its 21 member agencies to share information, develop initiatives, coordinate enforcement actions and conduct investigations related to intellectual property theft. Through this strategic interagency partnership, the IPR Center protects the public's health and safety and the U.S. economy.

ICE and CBP Join Forces with Mexican Government for Third Annual "Operation Holiday Hoax"

The National Intellectual Property Rights Coordination Center (IPR Center) recently announced the kickoff of Operation Holiday Hoax, an effort to track down those who are selling counterfeit and pirated products this holiday season.

The U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI) –led IPR Center is working with partners U.S. Customs and Border Protection (CBP), the U.S. Postal Inspection Service, the Consumer Product Safety Commission, and the government of Mexico to target stores, flea markets and swap meets involved in the importation, distribution and selling of counterfeit and pirated products in cities across the United States and in Mexico. Additionally, CBP officers will be conducting inspections and seize counterfeit merchandise at various U.S. ports of entry.

"The counterfeiting and piracy epidemic continues to spread around the world," said IPR Center Director Lev Kubiak. "Our partnership with the government of Mexico and the rest of our partners at the IPR Center show that this is a problem that affects everyone in the world, not just the United States. Together, we will continue to deliver blow after blow to criminals worldwide making a positive impact on American jobs here at home."

This is the third year that the IPR Center has conducted Operation Holiday Hoax. Last year's operation led to the seizure of more than 327,000 counterfeit and pirated items with a manufacturer's suggested retail price worth an estimated $76.8 million. In 2009 the operation netted more than $26 million worth seized goods.

"The protection of intellectual property rights is one of CBP's top priority trade issues," said Assistant Commissioner for International Trade Al Gina. "Operations like this protect American businesses and consumers. CBP works daily to keep counterfeit goods out of the U.S. and to bring producers and distributors of these goods to justice."

Last year, Mexico's Tax Administration Service conducted 845 inspections in the main ports of entry, executed 160 search warrants nationwide and seized 23.8 million counterfeit and pirated items including 10 tons of used clothing, cigarettes, electronics, tools and DVD's. The estimated value of the seized goods was 96.7 million pesos, or $7.1 million.

Holiday Hoax began Nov. 26 and is scheduled to run until Dec. 26. During that time federal and local law enforcement officers will seize products such as perfume, holiday lights, electronics, clothing and DVD's. As in years past, most of these items are ordered online as part of the holiday shopping season.

The IPR Center is one of the U.S. government's key weapons in the fight against counterfeiting and piracy. Working in close coordination with the Department of Justice Task Force on Intellectual Property, the IPR Center uses the expertise of its 21 member agencies to share information, develop initiatives, coordinate enforcement actions and conduct investigations related to IP theft. Through this strategic interagency partnership, the IPR Center protects the public's health and safety, the U.S. economy and the war fighters.

New York Man Arrested for Trafficking in Counterfeit Goods

An upstate New York man was arrested and charged by criminal complaint with trafficking in counterfeit goods. The charge carries a maximum penalty of 10 years in prison and a $2,000,000 fine. In addition, 15 websites allegedly selling counterfeit sporting merchandise were seized by federal law enforcement agents. The websites were seized as part of a global enforcement operation that targeted more than 130 websites operating worldwide. All of this is the result of an extensive investigation by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI).

According to the criminal complaint, in August 2012, Gary C. Hammer, 47, of Cheektowaga, N.Y., listed Microsoft Vista Business and Microsoft Office software for sale on Craigslist.

Further investigation determined that the merchandise being sold by the Hammer was counterfeit. Although the defendant was served Oct. 23 with a cease and desist letter from Microsoft Corporation, he continued to sell counterfeit Microsoft merchandise. He was arrested Nov 21.

Hammer made an initial appearance in court the same day as his arrest. He released on his own recognizance and is due back in court Dec. 12, 2012, at 11:00 a.m.

In a separate action, early this morning HSI special agents seized 15 websites that allegedly sold counterfeit sporting merchandise. According to the affidavit in support of the seizure warrants, some of the websites sold caps allegedly manufactured by New Era Cap, a Buffalo-based company.

 "The manufacturing and selling of "knock off" goods hurts businesses and people across a wide spectrum of our society," said U.S. Attorney William J. Hochul Jr., Western District of New York. "Victims of these crimes include not only those who create intellectual property and the employees of the legitimate businesses who turn the ideas into products Consumers are also hurt by unknowingly obtaining inferior or potentially harmful products, as are taxpayers who are unable to rely on taxes from legitimate sales to fund programs which benefit the community. I would therefore urge all to exercise caution knowing that if a deal sounds too good to be true, it probably is."

 "As we remind consumers, buying knockoffs doesn't pay off," said James C. Spero, special agent in charge of HSI Buffalo. "Those who sell counterfeit merchandise are robbing from the legitimate companies, many of them U.S.-based, that make these products. And perhaps most important, they're hurting the men and women who depend on those companies for their livelihood. Intellectual property theft amounts to economic sabotage, which is why HSI will continue to aggressively pursue product counterfeiters and those who sell counterfeit products."

The arrest and seizures are part of Project Cyber Monday 3 and Project Transatlantic, both efforts to crack down on counterfeit goods sold online during the holiday shopping season. They are the culmination of an investigation on the part of HSI.

Assistant U.S. Attorney Michael DiGiacomo and Kevin D. Robinson, Western District of New York, are prosecuting these cases on behalf of the U.S. government.