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Importers of Fake Brand Name Goods that Were Illegally Counterfeited in China are Sentenced to Federal Prison

FOR IMMEDIATE RELEASE
May 8, 2014

LOS ANGELES – A San Gabriel Valley businessman who coordinated the importation of 11 containers of counterfeit apparel – including Nike, Gucci and Coach products worth more than $2.3 million – was sentenced today to 31 months in federal prison.

Today’s sentencing is the second in the past two weeks in which a smuggling operation resulted in a federal prison term. Last week, a Glendale man who brought bogus AMG wheels into the country received a one-year prison sentence.

Both defendants previously pleaded guilty to trafficking in counterfeit goods.

In today’s sentencing, Kevin “Peter” Wang, 54, of Rosemead, was sentenced to 31 months by United States District Judge John A. Kronstadt. In addition to the prison term, Judge Kronstadt ordered Wang to serve an additional six months of home detention and to pay a $10,000 fine and $50,000 in restitution.

Wang helped Chinese exporters bring counterfeit goods – including fake Nike shoes (labeled as “garment hangers”); counterfeit Coach, Gucci, and Louis Vuitton handbags (labeled as “toilet paper”); and bogus NFL, NBA, and NHL jerseys – into the United States. According to court documents, from 2008 to 2012, the counterfeit goods were smuggled in shipping containers through the ports of Los Angeles and Long Beach.

In the second case that led to a prison term, Hamlet Ayvazyan, 37, of Glendale, was sentenced on Monday, April 28, to one year and one day in federal prison. Ayvazyan was sentenced by United States District Judge Margaret M. Morrow, who also ordered the defendant to pay a $4,000 fine.

Ayvazyan, the owner of Speedvision Motorsport in Glendale, imported wheel rims from a Chinese business known as "Shandong Chiping Xinfa Aluminous Product Co., Ltd.," which had offered wheels for brands that purported to be “Audi,” “BMW,” “Mercedes Benz,” “Land Rover,” “Porsche” and “Cadillac."

U.S. Customs and Border Protection officials discovered Ayvazyan's imports in January 2012 when they inspected an ocean container that contained 430 wheels that bore counterfeit Mercedes Benz “AMG” logos, with Ayvazyan and Speedvision as consignee. Undercover agents with Homeland Security Investigations posed as customers and met with Ayvazyan at Speedvision, where Ayvazyan sold to the agents a wheel with an “AMG” logo and placed a center cap “Mercedes” decal on the wheel.

In February 2012, agents executed a search warrant at Speedvision and found 189 additional wheels bearing counterfeit “AMG” marks. Although Ayvazyan claimed that the goods were “replicas,” the marks on the wheels were unauthorized copies of the registered “AMG” trademark. Ayvazyan also kept 2,100 adhesive logos and wheel center caps that bore marks such as “Mercedes Benz” and “BMW.”

Ayvazyan paid approximately $100 for each wheel and sold them for $200, which was substantially less than the manufacturer’s price for legitimate wheels, which was as much as $2,000.

The cases against Wang and Ayvazyan were investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI).

“Trafficking in counterfeit merchandise is a multi-billion dollar global business that robs governments of vital revenues and the industry of its due profits,” said Claude Arnold, special agent in charge of HSI Los Angeles. “HSI is committed to dismantling these schemes because the profits from such illegal ventures often go to fund more criminal enterprises.”

Release No. 14-058

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