Baltimore, Maryland –Xiaoying Xu, age 34, a Chinese citizen residing in Covina, California, pleaded guilty today to on a federal conspiracy and mail fraud charges related to her trafficking in counterfeit goods.  

The guilty plea was announced by United States Attorney for the District of Maryland Robert K. Hur; Special Agent in Charge Jennifer C. Boone of the Federal Bureau of Investigation, Baltimore Field Office; Special Agent in Charge John Eisert of Homeland Security Investigations (HSI) Baltimore; Postal Inspector in Charge Peter R. Rendina of the U.S. Postal Inspection Service - Washington Division; and Casey Durst, Director of Field Operations, U.S. Customs and Border Protection - Baltimore Field Office.

“Xu sold counterfeit products, representing them to unsuspecting customers as legitimate merchandise bearing the registered trademarks of legitimate companies.” said U.S. Attorney Robert K. Hur.  “The sale of counterfeit goods not only defrauds consumers and legitimate companies, but results in American jobs lost, American business profits stolen, and American consumers tricked into receiving substandard products.”

According to her plea agreement, from about August 2016 until approximately April 2019, Xu conspired with others to defraud e-commerce customers by importing and selling counterfeit consumer goods, specifically Pandora jewelry and Ray-Ban sunglasses.  Xu used her residence and offices in El Monte and Alhambra, California, as destination points for shipments of counterfeit goods shipped from Hong Kong and China.  Xu repackaged the counterfeit goods, then mailed them to unsuspecting customers throughout the United States who believed they had purchased authentic goods. 

Xu and other members of the conspiracy obtained funds from the victims of the counterfeit scheme through fraudulently acquired customer accounts opened in the names of other people at a global online payment company.  The online payment company sent the victims’ money to Xu by electronic transfer to bank accounts or by check, which Xu cashed at ATMs or deposited into bank accounts opened by co-conspirators. 

Xu admits that as a result of her fraudulent conduct, as well as her knowledge of the fraudulent conduct of her co-conspirators, members of the conspiracy sold $2,322,845 worth of counterfeit Pandora and Ray-Ban-branded products to unsuspecting customers, causing a loss to the customers of at least that amount.

Xu faces a maximum sentence of five years in prison for conspiracy to commit mail fraud and a maximum of 20 years in prison for mail fraud.  Chief U.S. District Judge James K. Bredar has scheduled sentencing for March 12, 2020.

United States Attorney Robert K. Hur commended the FBI, HSI, U.S. Postal Inspection Service, and U.S. Customs and Border Protection, in Maryland and in Los Angeles, California; Seattle, Washington; and Tampa, Florida for their work in the investigation.  Mr. Hur thanked Assistant U.S. Attorneys Peter J. Martinez and Martin J. Clarke, who are prosecuting the case.

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Baltimore, Maryland – A federal grand jury has indicted Xiaoying Xu, age 34, a Chinese citizen, and Yiwen Zhu, age 34, a Chinese citizen and legal permanent resident of the United States, both residing in Covina, California, on a federal conspiracy charge, mail fraud, and trafficking in counterfeit goods.  The indictment was returned on April 23, 2019, and the defendants were arrested today.

The indictment was announced by United States Attorney for the District of Maryland Robert K. Hur; Acting Special Agent in Charge Jennifer L. Moore of the Federal Bureau of Investigation, Baltimore Field Office; Acting Special Agent in Charge Cardell T. Morant of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Baltimore; Postal Inspector in Charge Peter R. Rendina of the U.S. Postal Inspection Service - Washington Division; and Casey Durst, Director of Field Operations, U.S. Customs and Border Protection - Baltimore Field Office.

“These defendants allegedly imported counterfeit goods from China and sold them as legitimate merchandise using the registered trademarks of legitimate companies.” said U.S. Attorney Robert K. Hur.  “Those who traffick in counterfeit goods are committing a crime which results in American jobs lost, American business profits stolen, and American consumers tricked into receiving substandard products.”

According to the 13-count indictment, from about August 2016 until approximately April 2019, Xu and Zhu conspired with others to defraud e-commerce customers by importing and selling counterfeit consumer goods, specifically Pandora jewelry and Ray-Ban sunglasses.  The indictment alleges that the defendants used their residence and offices in El Monte and Alhambra, California, as destination points for shipments of counterfeit goods shipped from Hong Kong and China.  Xu and Zhu allegedly repackaged the counterfeit goods, then mailed them to unsuspecting customers throughout the United States who believed they had purchased authentic goods. 

The defendants allegedly used fraudulent accounts set up with e-commerce marketplace companies to sell the counterfeit goods, misrepresenting to customers that they were authentic.  Xu and Zhu obtained funds from the victims of the counterfeit scheme through fraudulently acquired customer accounts opened in the names of other people at a global online payment company.  The online payment company sent the victims’ money to Xu and Zhu by electronic transfer to bank accounts or by check, which the defendants then cashed at ATMs.  The indictment alleges that the defendants then transferred the proceeds of the scheme from their bank accounts to other bank accounts opened in the names of other Chinese nationals.  

If convicted, the defendants face a maximum sentence of five years in prison for conspiracy to commit mail fraud and traffick in counterfeit goods; a maximum of 20 years in prison for each of six counts of mail fraud; and a maximum of 10 years in prison for each of six counts of trafficking in counterfeit goods.  The defendants are expected to have an initial appearance in U.S. District Court in the Central District of California.  No court appearance has been scheduled yet in Maryland.

An indictment is not a finding of guilt.  An individual charged by indictment is presumed innocent unless and until proven guilty at some later criminal proceedings. 

United States Attorney Robert K. Hur commended the FBI, HSI, U.S. Postal Inspection Service, and U.S. Customs and Border Protection, in Maryland and in Los Angeles, California; Seattle, Washington; and Tampa, Florida for their work in the investigation.  Mr. Hur thanked Assistant U.S. Attorneys Martin J. Clarke and Peter J. Martinez, who are prosecuting the case.

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