Five People, Corporations Charged With Illegal Toy Imports from China
Allegedly importing hazardous and counterfeit toys from China resulted in federal indictments in Brooklyn, N.Y., against five individuals and five corporations, the Justice Department said. The five individual defendants were arrested Feb. 6, and search and seizure warrants were executed, Justice said. The 24-count indictment charges Chenglan Hu, 51, Hua Fei Zhang, 52, and Xiu Lan Zhang, 60, all Chinese nationals and residents of Queens, N.Y., and Guan Jun Zhang, 29, and Jun Wu Zhang, 28, both naturalized citizens and Queens residents, along with their closely held companies Family Product USA Inc., H.M. Import USA Corp., ZCY Trading Corp., Zone Import Corp. and ZY Wholesale Inc., with importing and trafficking hazardous toys in violation of the Consumer Product Safety Act and toys bearing copyright-infringing images and counterfeit trademarks, as well as smuggling, money laundering and structuring.
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Assistant Attorney General Lanny Breuer said the defendants "allegedly retooled their operations many times in order to avoid detection, and despite repeated citations by the authorities, they continued to peddle counterfeit toys featuring Dora the Explorer, SpongeBob SquarePants and other popular children's characters." According to the indictment, the defendants' companies had children's toys seized by CBP from shipping containers entering the U.S. from China on 33 separate occasions. Seventeen of the 33 seizures were of violative toys, prohibited from import into and distribution in the U.S., under laws and regulations enforced by the CPSC, because of excessive lead content, excessive phthalate levels, small parts that presented choking, aspiration or ingestion hazards, and easily accessible battery compartments. Sixteen of the 33 seizures were of toys bearing copyright-infringing images and counterfeit trademarks.
The indictment charges that following each of the 33 seizures, the violator toy company was served written notice by CBP detailing the reason for the seizure, and a representative of the company signed a release form acknowledging the seizure and abandoning the seized goods. In the indictment, the government is seeking forfeiture of the seized vehicles and bank accounts and the restrained properties, in addition to a money judgment to be determined at trial.