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Crime & Cases February 14, 2013  RSS feed

GAME OVER FOR TOY IMPORTERS

Used R’wood Locations To Smuggle, Sell Counterfeits
by Robert Pozarycki

Five individuals who were arrested and indicted by the federal government last Wednesday, Feb. 6, for allegedly importing thousands of dangerous and counterfeit toys from China and selling them locally reportedly based their operations in Ridgewood and Corona.

Law enforcement sources said the suspects—Chenglan Hu, 51, Hua Fei Zhang, 62, Xiu Lan Zhang, 60, Guan Jun Zhang, 29 and Jun Wu Zhang, 28—allegedly smuggled into the U.S. over a seven-year period products bearing the logos of popular movies or children’s characters, many of which have been deemed hazardous to public health by the U.S. Consumer Product Safety Commission (CPSC).

The five individuals had been repeatedly caught by federal and local law enforcement agents over the years for importing, distributing and selling counterfeit toys, the indictment charges that they continued their operation and elude investigators by launching new companies.

Federal agents said the five operated Family Product USA Inc., located at 43-02 111th St. in Corona; H.M. Import USA Corp., located at 1717 Troutman St. in Ridgewood; ZCY Trading Corp., located at 41-29 111th St. in Corona; Zone Import Corp., located at 1177 Flushing Ave. in Bushwick; and ZY Wholesale Inc. in Bushwick.

All five suspects were taken into custody last Wednesday morning by federal agents as they executed search warrants at their locations. Additionally, the federal government also seized three luxury vehicles, three personal bank accounts and three corporate accounts belonging to the defendants.

The suspects face various charges of importing and trafficking hazardous toys in violation of the Consumer Product Safety Act and toys bearing copyright infringing images and counterfeit trademarks, smuggling, money laundering and structuring.

The charges were announced by Assistant Attorney General Lanny Brewer of the Justice Department’s Criminal Division; U.S. Attorney for the Eastern District of new York Loretta E. Lynch; Special Agent in Charge of Homeland Security Investigations in New York James T. Hayes Jr.; Robert E. Perez of Customs and Border Patrol; Consumer Product Safety Commission Chairwoman Inez Tenenbaum; and Police Commissioner Raymond Kelly.

“They allegedly retooled their operations many times in order to avoid detection, and despite repeated citations by the authorities, they continued to peddle counterfeit toys featuring ‘Dora the Explorer,’ ‘SpongeBob SquarePants’ and other popular children’s characters,” Breuer said. “Today’s actions reflect a Justice Department focused on ensuring that customers receive safe and legitimate goods.”

“For years, the defendants sought to enrich themselves by importing and selling dangerous and counterfeit children’s toys without regard for the law or the health of our children,” Lynch added. “Profits from the counterfeit items, as well as toys riddled with lead and choking hazards, went to provide the defendants with luxury cars.”

According to federal agents, the suspects had been illegally importing the toys which were produced in China ad then sold out of a storefront and warehouse in Ridgewood, as well as other locations across Brooklyn and Queens.

Investigators noted that the five companies which the crew operated had products seized previously by the Customs and Border Patrol on 33 separate occasions, 17 of which involved the removal of toys suspected of having lead content, excessive phthalate levels, choking hazards and easily accessible battery compartments.

Counterfeit items seized over the years have included toys bearing the logos and likenesses of characters such as Winnie the Pooh, Betty Boop, Teenage Mutant Ninja Turtles, Power Rangers, Spider-Man, Tweety, Mickey Mouse and Pokémon.

Trial Attorney Evan Williams of the Criminal Division’s Computer Crime and Intellectual Property Section and Assistant U.S. Attorneys Claire Kedeshian and William Campos of the Eastern District of New York are prosecuting the case.