San Jose Man Charged With Selling Millions of Dollars of Stolen and Counterfeit Cisco Merchandise
SAN JOSE, Calif. – Cuong Cao Dang, a/k/a Calvin Dang, was arrested this morning after a federal grand jury indictment charging him with conspiracy to commit mail fraud, six substantive counts of mail fraud, and money laundering, United States Attorney Melinda Haag and IRS-CI Special Agent in Charge José M. Martinez, announced.
According to an indictment filed yesterday and unsealed this afternoon, Dang owned and operated San Jose-based Network Genesis, Inc., a company that bought and resold used Cisco equipment. Dang also owned The Dang’s Investment, Inc. (TDI), a business dedicated to managing residential and commercial real estate. According to the indictment, from January 2006 through January 2013, Dang bought counterfeit or stolen Cisco merchandise from Cisco employees and resold that merchandise to Network Genesis customers, after altering the external serial numbers to make the items more difficult to trace. To further cover his tracks, Dang had his customers send payment to proxies, who deposited the money into their own bank accounts before funneling it back to Dang. The indictment alleges that Network Genesis had over $37 million in sales revenue from 2006 through the end of 2012.
Dang is also charged with forfeiture allegations. Upon conviction of any of the offenses in the indictment, Dang faces potential forfeiture of all property from the illegal conduct, including:
- 11 commercial and residential real properties, all located in San Jose;
- Five luxury automobiles;
- All funds in bank accounts held at Wells Fargo Bank and JP Morgan Chase;
- All funds in four ScholarShare College Savings Plan accounts Dang set up for each of his four children; and
- Cisco Equipment that was seized during the execution of search warrants at Network Genesis on January 23, 2013.
Dang was arrested early this morning at his home in San Jose, and made his initial appearance in federal court in San Jose, before The Honorable Howard R. Lloyd, United States Magistrate Judge. He is currently detained pending further bail proceedings. The defendant's next scheduled appearance is at 1:30 pm tomorrow for I.D. of counsel Judge Lloyd.
The maximum penalty for each count of conspiracy to commit mail fraud, in violation of Title 18, United States Code, Section 1349, is 20 years imprisonment, a fine of $250,000, or twice the gross gain or gross loss from the offense, and restitution to the victim. The maximum penalty for mail fraud, in violation 18 U.S.C § 1341, is 20 years imprisonment, a fine of $250,000 (or twice the gross gain/loss), and restitution. The maximum penalty for each count of engaging in monetary transactions using criminally derived property, in violation of 18 U.S.C § 1957, is 10 years in prison, and a fine of $250,000, or twice the amount of the criminally-derived property involved in the transaction. However, any sentence following conviction would be imposed by the court after consideration of the U.S. Sentencing Guidelines and the federal statute governing the imposition of a sentence, 18 U.S.C. § 3553.
Please note, an indictment contains only allegations against an individual and, as with all defendants, Dang must be presumed innocent unless and until proven guilty beyond a reasonable doubt.
Assistant United States Attorney David Callaway is prosecuting the case, with the assistance Elise Etter. The prosecution is the result of an investigation by the Internal Revenue Service, Criminal Investigation.