DA Rice Announces Takedown of Major Counterfeiting Operation

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More than $2 Million worth of health & beauty products of major international brands seized from five locations across Nassau County.

Mineola, NY - March 7, 2014 - Nassau County District Attorney Kathleen Rice announced the takedown of a large-scale, sophisticated counterfeiting operation in which more than $2 million worth of health and beauty products was seized yesterday from five locations across Nassau County.
 
Court-ordered search warrants were executed by teams yesterday at five locations. Arrested as the heads of the scheme yesterday were brothers Pardeep Malik, 59 of Plainview, and Hamant Mullick, 60 of Franklin Square.  They are each charged with three counts of Trademark Counterfeiting in the 1st Degree (a C felony) and one count of Trademark Counterfeiting in the 2nd Degree (an E felony).  Nassau County District Court Judge Anna R. Anzalone set bail at $100,000 for each defendant at arraignment today, and the defendants are due back in court on March 11.
 
“Health and beauty products like lip balms, oils, shampoos and inhalers are highly regulated in order to protect consumers, but these defendants are charged with going around those protections and stealing the brands of major corporations that comply with the law,” DA Rice said.  “These actions can endanger the public and local and federal officials, as well as industry manufacturers, are working hard to protect the public in this case.”
 
Working with the Nassau County Fire Marshals, the Valley Stream Fire Department, the NCPD DA Squad and ESU, U.S. Food & Drug Administration and U.S. Immigration & Customs Enforcement, and representatives of and several of the manufacturers of the products being counterfeited, DA investigators found the defendants operating manufacturing, storage and showroom facilities in Franklin Square, Oceanside, Freeport, and Valley Stream. More than $2 million worth of alleged counterfeit products were seized and removed in four tractor-trailer trucks yesterday.
 
The scheme was discovered when Valley Stream Fire Department officials, after responding to an April 2013 fire in their jurisdiction, returned to the location in January of this year for a follow-up to their investigation and stumbled upon what appeared to them to be a counterfeiting operation. Valley Stream FD officials notified Nassau County Fire Marshall officials, who went to the location, observed what appeared to be a counterfeiting operation and obtained samples of some of the product, which they sent to the manufacturers, who verified that the products were counterfeit.
 
After notifying Nassau County Fire Marshall officials and DA Rice’s office, samples of the products were sent to manufacturers, who verified that the products were counterfeits.
 
The brothers were found to be selling the goods to distributors.  Products have been found to turn up in retail locations in New York, Pennsylvania and Florida and investigation is underway to determine if there are more locations.  The distributors appear to be selling primarily or exclusively to smaller, independently-owned stores rather than large corporate chains.
 
One manufacturer has described this operation as the biggest known such manufacturing operation in the United States, while another has called it the only known such manufacturing operation in the United States for their products.
 
Yesterday’s searches and arrests represent the early stages of an ongoing investigation.  Investigators are trying to determine the entire scope of the scheme in terms of collaborators, where the fake products have been sold, and how much revenue the defendants have taken in as a result of the scheme.
 
DA Rice said that it’s not yet known whether there is a health risk associated with the counterfeit products, but that the seized products are being tested by labs right now to determine their safety and quality. Counterfeit products such as these potentially pose health risks because of the ingredients used and the lack of proper sanitary controls under which they are produced.
 
The counterfeit products found are facsimiles of major international brands owned by Johnson & Johnson, Pfizer, Procter and Gamble, and Unilever, including ChapStick, Johnson’s Baby Oil, Vicks VapoRub, Vicks Inhaler, Vaseline and Always sanitary pads.
 
Chris Vuturo, spokesman for Procter and Gamble, said: “Procter and Gamble applauds the action of Nassau County law enforcement in shutting down this operation, and helping protect people from these counterfeit products.  We’ll continue to work with all federal, state, and local authorities to continue frustrate and eliminate counterfeiting, and help them continue to pursue this investigation.  We encourage consumers to be cautious about buying branded goods that look suspicious, or from outlets that are unfamiliar – buy only from sources that are well known and trusted.”
 
Other products including over-the-counter cold medicines and painkillers were also found in the brothers’ “showroom” in Valley Stream, but the manufacturing source of those products is not yet known; no evidence of counterfeit medicine-making equipment was found by investigators yesterday.
 
FIVE TIPS TO IDENTIFY A FAKE
  • First look for obvious signs – a strange picture on the package, strange languages for your locale, strange colors, or strange typeface.
  • If the illegitimate product is more sophisticated, however, it can be hard to tell from looking.  The next best way is to consider the price paid.  If the price was atypically low, without any kind of coupon or special promotion, then it may be illegitimate.
  • Counterfeit products will not have the same quality or consistency of real products.
  • Also look at the expiration date, as this can be another indicator of a fake.
  • Try to shop at established and trusted stores, which are highly likely to be connected to legitimate supply chains.
Members of the public suspecting that a product is fake are urged to contact the manufacturer as well as local prosecutors.  Suspected products purchased in Nassau County can be referred to DA Rice’s Economic Crimes Bureau by calling her Criminal Complaint Unit at (516) 571-3505.
 
Nassau County Chief Fire Marshall Scott Tusa added that the locations also had “numerous fire & code violations including open electrical wiring, empty fire extinguishers, and locked & blocked exits that made the workers inside virtual prisoners in the event of a fire or other emergency.”
 
“The discovery of this operation illustrates the importance of the Fire Marshals day to day routine inspections and response to complaints across the County.  It was a routine response that allowed Fire Marshals to develop the initial information which lead to the larger investigation.”
 
Assistant District Attorney Andrew Weiss and Assistant District Attorney Whitney Matthews are prosecuting the case for DA Rice’s Economic Crimes Bureau.  Malik is represented by Steve Christiansen, Esq.  Mullick is represented by Michael Brown, Esq.
 
The charges are merely allegations and the defendants are considered innocent until and unless found guilty.
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