ICE Homeland Security Investigations Nabs Smuggled Counterfeit Goods

On July 15, 2020, Hang “Henry” Chen, an employee of CBK, CBK International, and Silicon Electronics, was sentenced by U.S. District Judge James Donato to four months incarceration with three-years supervised release, a $75,000 fine, and restitution up to $137,000.

Chen’s co-defendant, co-conspirator, and owner of CBK and associated companies, Lixiong “John” Chen 45, a citizen of China, fled justice by boarding a flight a day before his trial to Beijing, China, via Tijuana, Mexico. Lixiong Chen was previously indicted Sept. 20, 2018, for violations of Title 18 USC 545, (Smuggling Goods into the United States) and 18 USC 2320(a) (Trafficking in Counterfeit Goods). An INTERPOL Wanted Person Diffusion Red Notice for Lixiong Chen has been issued and he remains at large.

Beginning in 2012, Immigration and Customs Enforcement (ICE) Homeland Security Investigations (HSI) San Francisco special agents, with the assistance of Customs and Border Protection, San Francisco Office of Field Operations, and the Newark Police Department made numerous seizures of counterfeit electronic goods at businesses and residences owned and operated by Lixiong “John” Chen. The HSI-led investigation revealed that the counterfeit goods were imported from China and infringed on various trademarks, including Blackberry, HP, Microsoft, Samsung and UL.

Several undercover purchases of counterfeit goods were made through websites and third-party digital store fronts operated by Chen and associates. A review of financial records revealed the PayPal account linked to one of Chen’s eBay store fronts netted approximately $24.5 million since its creation in 2009. This was the same account used to process the payment for an HSI undercover purchase. Further investigation revealed the business accounts held by Chen have received approximately $42.4 million since their creation in 2001.

“These peddlers of counterfeit items were stealing profits from legitimate companies and their hardworking employees, who are trying to earn a living to provide for their families,” said Tatum King, HSI San Francisco (NorCal) Special Agent in Charge. “The results of this operation were achieved through HSI’s interagency partnership with local, state and federal law enforcement, and the prosecutorial tenacity of the U.S. Attorney’s Northern District of California Office.

“Keeping counterfeit goods off the streets not only protects American consumers, but our economy as well,” said Richard F. Di Nucci, CBP San Francisco Director of Field Operations. “Customs and Border Protection works closely with our federal, state, and local law enforcement counterparts, enabling us to interrupt criminal activities at and beyond the border.”

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