San Diego native Zhiwei "Allen" Liao has been handed a 51-month prison sentence after being found guilty of orchestrating an international counterfeit Apple products scheme, federal authorities announced. Liao, identified as the conspiracy leader, will also relinquish two properties and monetary assets accumulating to $120,370, along with over 200 Apple devices, which were all confiscated during the investigation.
According to the U.S. Department of Justice, Liao and his brothers, Zhimin "Jimmy" Liao and Zhiting "Tim" Liao, spearheaded a fraud involving over 10,000 fake Apple iPhones and iPads. These counterfeits were imported from China, so well-crafted that they bore real identification numbers matching those of legitimate devices previously sold in the U.S. and Canada. Under Liao's guidance, accomplices made rounds to numerous Apple Stores across both countries, attempting to replace the counterfeits with genuine products. The U.S. Attorney's Office revealed the scheme inflicted a $6.1 million loss on Apple, Inc.
"This was a massive, sophisticated fraud that victimized not only Apple, Inc., but thousands of Apple product owners across North America," U.S. Attorney Tara McGrath said in a statement obtained by the Justice Department. The counterfeit devices and illicit earnings were constantly moved around to a network of accomplices to diversify risks and confuse law enforcement as per the details of the case.
During the trial, U.S. District Judge Cynthia Ann Bashant underscored the necessity for a substantial prison term for Liao, given his central role in this elaborate transnational counterfeit merchandise network. According to the court, the fraudulent operations spanned multiple years across North America. Liao's brothers, who played significant roles in the conspiracy, received 41-month sentences last October, proving this fraudulent network's intensity and reach.
The investigation leading to these convicting outcomes was a multi-agency collaboration primarily involving the Federal Bureau of Investigation and the San Diego Police Department. "Mr. Liao’s sentencing closes a major chapter in a multi-year investigation that exposed an international, elaborate scheme to sell counterfeit goods worldwide," FBI San Diego Special Agent in Charge Stacey Moy commented, as reported by the Justice Department. The collective effort resulted in 12 felony convictions, the seizure of five properties valued over $4.1 million, more than $250,000 in cash, and hundreds of Apple products used in the operation.
