US man charged with $1bn fake Cisco scam

A company CEO based in Miami, Florida, has been arrested on charges of importing $1bn worth of counterfeit Cisco equipment from China and then selling it on Amazon and eBay.

The Department of Justice says it indicted 38-year-old Onur "Ron" Aksoy (38) – sometimes going by Durden – for selling the counterfeit networking gear using multiple online storefronts.

Aksoy is accused of importing tens of thousands of fraudulent Cisco devices from China and Hong Kong. He then created at least 19 companies in New Jersey and Florida – which he called the "Pro Network", to help him resell the hardware as genuine through the e-commerce sites.

His companies allegedly imported tens of thousands of fraudulent and counterfeit Cisco networking devices from China and Hong Kong and resold them to customers in the US and overseas, falsely representing the products as new and genuine.

The estimated value of the counterfeits at manufacturer's recommended selling prices could have been around $1bn. The scam was operating between 2014 and 2022, and over that period Customs and Border Protection (CBP) intercepted around 180 shipments of the fakes.

The DoJ says Aksoy's operation generated more than $100m in revenue from the activity, with Aksoy himself pocketing "millions of dollars." He was able to buy the counterfeit equipment at a 95 to 98 per cent discount to genuine Cisco products, according to the complaint.

Cisco was also aware of the activity, sending Aksoy several "cease and desist" letters over the period, but the network was finally broken up when agents executed a search warrant at a warehouse and seized 1,156 counterfeit Cisco devices with a retail value of over $7m.

According to the indictment, the devices the Pro Network companies imported from China and Hong Kong were typically older, lower-model products – some of which had been sold or discarded – which counterfeiters then modified to appear to be genuine versions of new, more expensive Cisco devices.

The DoJ says the Chinese counterfeiters often added pirated Cisco software and unauthorised, low-quality, or unreliable parts, including components to circumvent technological measures to check for software license compliance and to authenticate hardware.

To make the devices appear new, genuine, high-quality, and factory-sealed by Cisco, they allegedly added counterfeited Cisco documentation, packaging, and other materials.

The fakes often suffered from performance and safety issues and sometimes failed entirely "causing significant damage to their users' networks and operations – in some cases, costing users tens of thousands of dollars."

Aksoy is charged with one count of conspiracy to traffic in counterfeit goods and to commit mail and wire fraud; three counts of mail fraud; four counts of wire fraud; and three counts of trafficking in counterfeit goods.

Cisco is waging a war against counterfeiters, with some success, but the premium pricing their equipment commands makes them a constant target.

The company recommends that customers buy Cisco products only from authorised partners or directly from Cisco in order to minimize the risk of purchasing counterfeits.