Florida Man Sentenced For Counterfeit Razor Blades
Receives 30 Month Sentence
GRAND RAPIDS, MICHIGAN – Jeffrey Steven Telsey, 56, of Delray Beach, Florida, was sentenced for conspiring to traffic in counterfeit Gillette razorblades, announced U.S. Attorney Patrick A. Miles, Jr. U.S. District Judge Janet T. Neff sentenced the defendant to 30 months custody followed by three years of supervised release. Telsey was ordered to pay $400,506.17 in restitution and a $25,000 fine. In sentencing Telsey, Judge Neff characterized the trafficking of counterfeit merchandise as a quintessential white collar crime that is a serious offense against the public. Judge Neff expressed a desire to send a strong message of deterrence.
Along those lines, U.S. Attorney Miles noted, “Much of our nation’s value in the global economy is derived from intellectual property – ideas, brands, innovations, and creations. We must vigilantly protect those properties. Would be criminals should know that they face prosecution and serious criminal penalties when they steal from companies and the public by committing fraud through counterfeit and pirated goods.”
In January 2008, Homeland Security Investigations (HSI) learned that counterfeit Gillette Mach3 razor refills were being distributed through Meijer Stores. Officials from Meijer Stores and Proctor and Gamble (P&G), the owners of the Gillette brand, immediately cooperated with HSI. HSI coordinated a series of controlled purchases of counterfeit razorblades from Telsey, who operated a business called JCA Enterprises (JCA). At the same time, Meijer Stores conducted a company-wide recall of the Gillette razorblades to confiscate the counterfeit product.
JCA was a “diverter” business and collected odd and leftover lots of health and beauty care products for resale to wholesalers and large retail outlets. Mixed in with JCA’s legitimate business was the trafficking of counterfeit razorblades. U.S. Attorney Miles stated, “Trafficking in counterfeit products undermines the public trust. The public expectation of quality and value in brand names can be easily dashed by one bad experience.”
In November 2009, HSI executed a search warrant on JCA located in Boca Raton, Florida, and seized approximately 27,000 units of counterfeit Gillette-branded razors were identified and seized, valued at approximately $425,000 MSRP. On the same day the search warrant was executed, HSI agents seized Telsey’s business bank account which contained $400,506.17. In March 2010, HSI discovered that Telsey continued to sell counterfeit merchandise to other distributors supplying other national and regional retailers.
After a lengthy investigation, HSI determined that Telsey obtained the counterfeit merchandise from an importer in New Jersey. The importer, in turn, obtained the counterfeit razorblades from manufacturers in China. The volume of counterfeit razorblades is estimated to be in the millions of dollars. P&G advised that it is committed to the highest quality products and only manufactures its Gillette razorblades in facilities in Boston, Massachusetts, and Berlin, Germany. P&G reports that sales of counterfeit Gillette razorblades have decreased substantially since HSI’s investigation of Telsey.
“Counterfeit goods cost American brand holders billions of dollars on an annual basis,” said William Hayes, acting special agent in charge for HSI Detroit. “The unfortunate reality is that these losses are then passed on to the end user: you and me. HSI will continue to work collaboratively with our law enforcement partners to aggressively target individuals and groups involved in the trafficking of counterfeit goods.”
This case was investigated by Homeland Security Investigations. Prosecution of the case is assigned to Daniel Y. Mekaru, Assistant United States Attorney.