Investigators Seize Fake Luxury Goods Worth Half a Billion Dollars

Enough fake handbags, wallets and belts were seized by federal investigators to fill 22 shipping containers, officials from Homeland Security Investigations, a branch of the U.S. Customs and Immigration Enforcement agency, announced Thursday.

The goods, equal to the length of three football fields if they were laid out end to end, were part of a scheme originating in China and involved 33 people who officials said were arrested, concluding a six-year investigation.

“This is the largest investigation that our agency has had regarding the amount of counterfeit items,” said Angel Melendez, New York’s Special Agent in Charge of Homeland Security Investigations in New York.

Ronald Vitiello, deputy director of U.S. Immigration and Customs Enforcement, announced the arrests of the men and women — 32 of whom are in the country legally — in a news conference in New York on Thursday. A federal grand jury in the Eastern District of New York made the indictments.

Officials estimated that the loss in retail value to the United States was nearly a half-billion dollars, and said it was the largest seizure of fake goods they had made. Twenty of the containers had come in through the Port of New York and New Jersey, and two through the Port of Los Angeles, Melendez said. The goods seized were knockoffs of popular brands, including Gucci, Tory Burch, Hermes, Coach, Michael Kors and Louis Vuitton. There was knockoff Chanel perfume, too, which concerned investigators since previous schemes had involved using animal urine instead of the perfume company’s formula.

Melendez said that fraud scheme had two parts. In one, counterfeit goods were made in China and then shipped to the U.S. through as many as eight legitimate shipping companies. Companies in New York, including several in Queens and Manhattan, then distributed the goods.

In the other part of the scheme, he said, defendants traveled to China to purchase generic items, which could be exported legally. A separate factory then produced the knockoff logos, which were smuggled into the United States and affixed to the goods.

As part of the indictment, ICE officials said they also seized personal property belonging to the defendants in the New York metropolitan area worth $12 million.

ICE is better known for its operations in domestic immigration enforcement, which have led some Democratic candidates around the country to call for the agency to be abolished. Some officials within Homeland Security Investigations, which conducts investigations of crimes such as counterfeit goods, money laundering, drug trafficking, human smuggling, child exploitation and cybercrimes, have sought to distance themselves from immigration enforcement.

In June, 19 investigators sent a letter to Kirstjen Nielsen, the secretary of the Department of Homeland Security, requesting a stand-alone agency.