MLB and Starbucks Counterfeit Goods Smuggling Ring Caught by Customs

An organization smuggling over 3,500 counterfeit items, including MLB sneakers and Starbucks tumblers, was caught in a customs crackdown.

The Gwangju Regional Customs Office of the Korea Customs Service announced on the 18th that it had uncovered six members of the organization, including a Korean-Chinese ringleader, domestic collectors and sellers, and distribution intermediaries, who smuggled 3,554 counterfeit items worth approximately 300 million KRW and distributed them domestically, charging them with violations of the Customs Act and Trademark Act, and referred them to the prosecution.

According to Gwangju Customs, the smuggling organization disguised the goods intended for sale as overseas direct purchase items for personal use and smuggled counterfeit products from China.

In particular, to evade customs enforcement, they showed meticulousness by illegally using the names of 645 Chinese residents in Korea and 22 addresses to repeatedly bring in counterfeit goods in small quantities over hundreds of occasions.

By abusing overseas direct purchase, the smuggling organization fraudulently reduced customs duties and value-added tax, and when selling domestically, they deceived consumers into believing the products were genuine by using official customs clearance documents.

The smuggled counterfeit goods were stored in secret warehouses prepared in places such as Incheon, then handed over to domestic distributors through intermediaries, and later distributed wholesale through professional merchants or sold on retailers’ TikTok LIVE broadcasts.

During the investigation tracking the smuggling organization, Gwangju Customs additionally discovered a warehouse storing counterfeit goods and seized about 500 counterfeit items of famous overseas brands, including Hermes sneakers and Bulgari watches, with a genuine market value of approximately 2.4 billion KRW. Two domestic sellers who attempted to distribute these items in the market were also arrested.

A Gwangju Customs official stated, “With the surge in overseas direct purchases, smuggling disguised as personal use items imported in small quantities is becoming more frequent,” and added, “Gwangju Customs will continue to strengthen crackdowns on illegal activities abusing overseas direct purchase to prevent damage to consumers and companies caused by intellectual property infringement products.”