Federal agents say a Hollywood, Florida, shipping stop exposed a sprawling refund-fraud operation that quietly bled Target stores out of millions in electronics.
Homeland Security Investigations agents this week arrested 28-year-old Migui Li of Levittown, N.Y., and 20-year-old Ziyu Zhao of Flushing, N.Y., both described as Chinese nationals, in connection with what authorities call a transnational refund-fraud ring targeting Target. The pair are charged with conspiracy to commit mail and wire fraud and are allegedly tied to about $94,000 in losses at Target locations across the Southeast, while the broader scheme has cost the retailer roughly $4.6 million since 2022. As of Friday morning, they were being held in Broward Sheriff’s custody at the Paul Rein Detention Facility on behalf of the U.S. Marshals Service, according to Local 10.
Alleged post-purchase markdown scheme
According to a federal criminal complaint, the group’s playbook hinged on what investigators call a “post-purchase markdown.” Members allegedly bought electronics at full price, then pulled up Target’s website on their phones or other devices and altered the on-screen product display to show a lower price. They would then walk over to customer service and request a price-match refund based on that doctored price, authorities say.
Instead of cash, the refunds came in the form of Target gift cards, which were then used to buy fresh merchandise. Those items were boxed up and shipped overseas, with agents intercepting packages bound for Hong Kong that were filled with Polaroid cameras, film, Nintendo Switch consoles and other electronics, according to the complaint. One suspect allegedly told investigators he received gift card serial numbers through WeChat, and another admitted to changing displayed prices online, per Local 10.
Federal response and policy context
The case lands as federal officials and lawmakers are trying to bulk up tools to tackle organized retail crime, which increasingly crosses borders and leans on digital tricks like price manipulation and anonymous resale markets. A House report tied to the Combating Organized Retail Crime Act of 2025 urged the creation of an organized retail crime coordination center inside Homeland Security Investigations and recommended letting federal prosecutors aggregate stolen goods over time to strengthen cases. Congress.gov lays out those findings and proposals.
Legal implications
Li and Zhao now face conspiracy to commit mail and wire fraud, both heavyweight federal counts if prosecutors follow through. Mail and wire fraud charges each carry potential sentences of up to 20 years in prison under federal law (Legal Information Institute), while a general conspiracy conviction can bring up to five years (Legal Information Institute). Prosecutors can also seek forfeiture of any proceeds and related penalties if the case moves forward.
Federal investigators say the probe is still active and more arrests or charges could be on the horizon as they track where the electronics went after leaving U.S. shelves. For Target and other big retailers, the case is a pointed reminder that even everyday perks like price-matching can be twisted into fuel for global resale operations siphoning off millions.
