In a nutshell: A judge has sentenced the CEO of 19 fraudulent tech firms to six years in prison on conspiracy and fraud charges. The Florida man headed up a scam that sold counterfeit Cisco networking equipment. Authorities estimate the criminal enterprise sold more than a billion dollars worth of gear.
Onur “Ron” Aksoy was arrested and indicted in 2022 on wire and mail fraud and conspiracy to commit wire and mail fraud. A year later, Aksoy signed a plea deal to receive a reduced sentence. The judge ordered that he spend the next six years in prison and pay $100 million to Cisco and other victims of his fraudulent dealings.
Aksoy operated 19 online companies under the umbrella corporation Pro Network Entities. The scattering of front firms sold counterfeit networking equipment through sites like eBay and Amazon from 2013 to 2022 under at least 25 storefront aliases. Some of his customers included the US Army, Navy, and Air Force. He also sold gear to other government agencies, schools, hospitals, and private enterprises.
The quality of the fraudulent gear was substandard, suffering poor performance and complete failures after installation. In a Thursday press release, the Department of Justice indicated that Pro Network sourced its devices from China, the top supplier of counterfeit electronics. The devices started life as Cisco rejects. Counterfeiters made a few alterations, created forged documentation, loaded the equipment with authentic but pirated software, and labeled them “refurbished.”
In 2014, only a year after Aksoy began selling the knockoff devices, Cisco and law enforcement became aware of the suspicious activity. Cisco sent Pro Network seven cease-and-desist notices, but Aksoy replied with forged invoices using aliases and fake addresses. So, US Customs began seizing shipments destined for the scammer.
Between 2014 and 2022, agents confiscated approximately 180 shipments of fake Cisco equipment. However, Aksoy used fake names and documents to recover many of these seizures. The most concerning aspect of the scheme was its scale and the way it virtually compromised large portions of the US infrastructure.
“Through an elaborate, years-long scheme, Aksoy created and ran one of the largest counterfeit-trafficking operations ever,” Attorney for the United States Vikas Khanna for the District of New Jersey. “His operation introduced tens of thousands of counterfeit and low-quality devices trafficked from China into the US supply chain, jeopardizing both private-sector and public-sector users, including highly sensitive US military applications like the support platforms of US fighter jets and other military aircraft.”
Despite selling the products at discounts as deep as 94-percent compared to the MRSP of genuine equipment, Aksoy managed to sell at least $1 billion in fake gear. Upon arrest, authorities confiscated another 1,156 devices worth $7 million from Aksoy’s warehouse.
Caveat emptor.