US-Turkish Dual Citizen Sentenced for Selling Counterfeit Cisco Products to US Military

Cisco Systems logo is seen in a file photo taken in 2017. Justin Sullivan/Getty Images

A federal judge has sentenced a dual U.S.-Turkish citizen to six and a half years in prison for selling counterfeit computer networking equipment, including equipment that was used to support U.S. military aircraft.

Federal prosecutors had alleged that Onur Aksoy, 40, had operated dozens of business entities and online storefronts from 2013 to 2022 in a scheme to traffic in counterfeit and fraudulent Cisco networking equipment.

This counterfeit networking equipment attracted both buyers in the private sector and U.S. government users. The counterfeit equipment ended up being used in U.S. military applications, including support platforms for U.S. fighter jets and other military aircraft.

Mr. Akso pleaded guilty last June to mail fraud and to conspiring with others to traffic in counterfeit goods, to commit mail fraud, and to commit wire fraud.

On May 2, U.S. District Judge Peter G. Sheridan of the United States District Court for the District of New Jersey handed Mr. Aksoy a 78-month prison sentence. Along with the prison term, Judge Sheridan sentenced Mr. Aksoy to undergo another three years of supervised release, pay a $40,000 fine, and pay another $100 million in restitution to Cisco. The court will assess further restitution payments Mr. Aksoy must pay to victims at a later date.

Counterfeit Software From China

Court records indicate that Mr. Aksoy’s scheme to traffic in counterfeit computer equipment was uncovered through a joint investigation by the Department of Homeland Security’s Homeland Security Investigations unit, the Office of Inspector General for the U.S. General Services Administration, the Defense Criminal Investigative Service, the Naval Criminal Investigative Service, and U.S. Customs and Border Protection.

A 2022 complaint filed in the case alleged that Mr. Aksoy sourced the counterfeit computer networking equipment from suppliers in Hong Kong and mainland China. The complaint states that Mr. Aksoy and his network of businesses, dubbed the “Pro Network,” were able to obtain the counterfeit equipment for as much as 98 percent cheaper than the manufacturer’s suggested retail price (MSRP) of the Cisco networking equipment the counterfeits were ripping off.

Investigators estimated that Mr. Aksoy generated about $100 million in gross revenue as part of the scheme to sell counterfeit Cisco equipment.

In several cases, Mr. Aksoy’s customers complained that the equipment his Pro Network had sold them was “counterfeit, substandard, used, or broken; had missing parts; did not work; were either not covered or were not eligible for Cisco technical support coverage; and in some instances had caused significant damage to these customers’ networks and operations.”

The Pro Network operated part of its online storefront through Amazon, but the online retail platform shut down several of the Pro Network’s product listings for purported Cisco products.

An apparent break in the case came during the execution of a search warrant at Pro Network’s warehouse and headquarters in Doral, Florida, in July 2021. During the search, law enforcement officials recovered some 1,156 purported Cisco devices. Investigators believe the combined MSRP value of the Cisco products these counterfeit devices might have passed for totaled $7,011,296.

Aksoy’s Plea Deal

Mr. Aksoy admitted in a May 2023 plea agreement to working with co-conspirators in China and Hong Kong to import the counterfeit equipment and then resell it.

In exchange for pleading guilty to a count of conspiring to commit fraud and a count of mail fraud, prosecutors agreed to drop a second mail fraud count, four more wire fraud counts, and three more counts for trafficking in counterfeit goods.

NTD News reached out to attorneys who represented Mr. Aksoy in the federal case but did not receive a response by press time.

“Aksoy sold hundreds of millions of dollars’ worth of counterfeit computer networking equipment that ended up in U.S. hospitals, schools, and highly sensitive military and other governmental systems, including platforms supporting sophisticated U.S. fighter jets and military aircraft,” Principal Deputy Assistant U.S. Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division, said following the sentencing decision on May 2. “Criminals who flood the supply chain with low-quality networking equipment from China and Hong Kong harm U.S. businesses, pose serious health and safety risks, and compromise national security.”

From NTD News