DOJ Seizes More Than $896,000 From Monetary Accounts

Proceeds from interbank and PayPal accounts were from the sale of counterfeit sports apparel and jerseys sold online.

The Department of Justice said Tuesday it seized more than $896,000 in proceeds from the distribution of counterfeit sports apparel and jerseys that were in interbank accounts and three PayPal accounts.

This story first appeared in the April 11, 2012 issue of WWD.  Subscribe Today.

The seizure was the result of an investigation into the sale of counterfeit goods on commercial Web sites. Seven domain names involved in the sale of counterfeit goods were also seized. The seizure warrants were unsealed Thursday in a federal court for the District of Columbia.

Homeland Security’s Immigration and Customs Enforcement said in June that it was initiating Operation In Our Sites to target commercial intellectual property crimes that occur online, such as e-commerce retailers selling counterfeit goods. Many of those sites sell counterfeit shoes, handbags, athletic apparel and sunglasses, said the Department of Justice. The DOJ also said 758 domain names of Web sites that sell counterfeit goods have been seized since the initiative began.

In the latest seizure, law enforcement agents said in court documents that some subjects whose domain names had been seized in November 2010 continued to sell counterfeit goods using new domain names. The individuals, based in China, sold counterfeit professional and collegiate sports apparel. Law enforcement agents, prior to obtaining seizure warrants, confirmed that the goods were counterfeit following undercover purchases from the Web sites using the new domain names.

Payments for the counterfeit goods were made using PayPal Private Ltd. accounts, with the proceeds later wired to bank accounts at Chinese banks. A total of $826,883 was seized from interbank accounts, those held by the Chinese banks in the U.S., while another $69,504 was taken from three PayPal accounts used in the sales, according to the DOJ.

Assistant Attorney General Lanny A. Breuer of the DOJ’s criminal division said, “This investigation disrupted an online counterfeit goods operation and also struck at the heart of the criminal enterprise by seizing hundreds of thousands of dollars in illegal profits. The Justice Department, together with our partners at [Immigration and Customs Enforcement], will continue to do all that we can to punish and deter the sale and distribution of counterfeit goods.”