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CEO Accused of Making Millions via Sale of Fake Cisco Devices

The US Department of Justice announced on Friday that a man has been arrested and charged for allegedly selling fraudulent and counterfeit Cisco products.

The suspect is 38-year-old Onur Aksoy of Miami, who is allegedly also known as Ron Aksoy and Dave Durden. According to authorities, he was the CEO of at least 19 companies — collectively tracked as Pro Network Entities — that bought fake Cisco networking equipment from China and Hong Kong and sold it in the United States and elsewhere.

The fake products had counterfeit Cisco labels, stickers, boxes and documentation to appear new, genuine and of high quality. In reality, many of them were older Cisco products that had been discarded or sold and then modified by the Chinese supplier.

“As alleged, the Chinese counterfeiters often added pirated Cisco software and unauthorized, low-quality, or unreliable components – including components to circumvent technological measures added by Cisco to the software to check for software license compliance and to authenticate the hardware,” the DoJ said.

The fake devices were acquired for significantly smaller prices compared to the original equipment, in some cases for as much as 99% cheaper. The devices were then sold at big discounts compared to the original products.

Aksoy allegedly wired at least $55 million to his suppliers and generated at least $100 million in gross revenue through this scheme. Authorities say he derived millions of dollars for his personal gain.

Investigators estimated that tens of thousands of counterfeit Cisco devices were distributed via the scheme. Had it been new and genuine, the equipment would have been worth roughly $1 billion.

The DoJ says the fake devices were sold on Amazon, eBay and through direct sales on the websites of the fake companies set up by the man. The equipment was acquired by hospitals, schools, government agencies and even the military. The devices often malfunctioned, in some cases costing users tens of thousands of dollars.

Despite many of the shipments from China being seized by US authorities, despite Cisco sending cease and desist letters to Aksoy and his companies, and despite customer complaints that led to Amazon removing product listings, Aksoy and his companies continued doing business. The alleged fraudster even hired legal representation and provided fake financial documents.

The DoJ has made available a list of Pro Network companies, as well as eBay and Amazon storefronts used by Aksoy. Potential victims are advised to get in touch with authorities.

The news of Aksoy’s arrest comes just weeks after Cisco informed customers to upgrade the IOS software on some switch models to ensure that the devices are not counterfeit.

In addition to performance and functionality problems, counterfeit devices can introduce significant security risks.

In 2020, F-Secure reported finding two fake Cisco switches on a customer’s network. The cybersecurity firm was asked at the time to look for the presence of backdoors. While no backdoors were identified, its researchers did notice that the devices had exploited a zero-day vulnerability that allowed bypassing security restrictions.

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Eduard Kovacs (@EduardKovacs) is a contributing editor at SecurityWeek. He worked as a high school IT teacher for two years before starting a career in journalism as Softpedia’s security news reporter. Eduard holds a bachelor’s degree in industrial informatics and a master’s degree in computer techniques applied in electrical engineering.