Corrupt Contractor Orchestrated Chinese Counterfeiting Scheme

October 13, 2022Coffee or Die
A US Air Force C-130H Hercules loadmaster for the 746th Expeditionary Airlift Squadron adjusts his night vision in preparation for an airdrop over Syria on June 11, 2018. Federal investigators say that many airmen received counterfeit uniforms that failed to baffle enemy night vision goggles. US Air Force photo by Staff Sergeant Rion Ehrman.

A US Air Force C-130H Hercules loadmaster for the 746th Expeditionary Airlift Squadron adjusts his night vision in preparation for an airdrop over Syria on June 11, 2018. Federal investigators say that many airmen received counterfeit uniforms that failed to baffle enemy night vision goggles. US Air Force photo by Staff Sergeant Rion Ehrman.

A Brooklyn defense contractor who orchestrated a vast Chinese counterfeiting scheme that sent unsafe knockoff uniforms to US troops is going to prison.

On Wednesday, Oct. 12, in Providence, Rhode Island, US District Judge William E. Smith sentenced Ramin Kohanbash to 40 months in a federal penitentiary and ordered him to repay $20 million for the bogus gear, some of which ended up with US Army soldiers and Air Force airmen in Afghanistan.

In 2019, Kohanbash, 52, pleaded guilty to conspiracy to commit wire fraud and trafficking in counterfeit goods. Investigators estimate that at least 13,332 bogus jackets that failed to baffle night vision goggles and 18,597 flame-resistant hoods that actually could catch fire were shipped to US military supply depots worldwide.

Kohanbash's crooked contractor co-defendants — Bernard Klein, 41, of Brooklyn, and Terry Roe, 49, of Burlington, North Dakota — have also pleaded guilty.

Klein exited federal prison on May 27 after serving an 18-month sentence. Roe, the owner of Dakota Outerwear, is slated to be sentenced Oct. 20 to 37 months behind bars.

“American servicemen and women risk their lives every day in defense of the nation,” said US Attorney Zachary A. Cunha in a prepared statement released in the wake of Kohanbash’s sentencing. “But the risks they face should never come from the uniforms they wear, and the equipment they carry. In this case, defendants’ actions did exactly that, substituting substandard, foreign-made knockoffs for American products. I am tremendously pleased that the defendants charged in this matter are being held accountable for their actions.” 

counterfeit chinese scheme

US Air Force Tech. Sgt. Jason Demoss, the 407th Expeditionary Civil Engineer Squadron's assistant chief of firefighting operations, squeegees agitated foam from a fire hose while transferring fire retardant from a foam trailer with Senior Airman Francisco Villalobos (left) and Staff Sgt. Clinton Manus, both 407th ECES firefighters, at the 407th Air Expeditionary Group, Jan. 6, 2016.US Air Force photo by Master Sgt. Benjamin Wilson.

Neither Kohanbash nor his criminal defense attorneys returned multiple Coffee or Die Magazine messages seeking comment.

According to federal filings, he’s paid back $634,398 of the $20 million he owes. Another $24,105 in cash was seized by federal agents executing a search warrant four years ago.

The trio’s scheme began in 2013 and hinged on duping both Chinese and American customs officials, according to federal prosecutors.

Knockoff uniforms were sewn in China and then shipped to Kohanbash’s New Jersey warehouse to be sold to the US military and its suppliers, including Dakota Outerwear.

Even after federal agents raided Kohanbash’s warehouse in late 2018, he toiled to schedule another illicit shipment from China in early 2019. Agents seized it, too.

According to federal inventory sheets obtained by Coffee or Die, Kohanbash’s company, California Surplus, was caught with 6,588 articles of phony military gear, including multicolor ponchos, US Army gloves, and fleece jackets. 

Chinese counterfeiting scheme

US Air Force Senior Airman Christopher Crusius, a 612th Air Base Squadron firefighter, is engulfed in flames as he opens the hood during a car fire as part of Central America Sharing Mutual Operational Knowledge and Experiences (CENTAM SMOKE) Exercise on Aug. 27, 2013 in Honduras. US Air Force photo by Staff Sgt. Jarrod Chavana.

Lt. Gen. Stacey T. Hawkins, who oversaw the US Air Force’s logistics, civil engineering, force protection, and nuclear integration programs during the probe, told prosecutors last year that 30 types of counterfeit items ended up in his service's supply chain.

Military investigators found that more than 18,000 hoods sold to the Air Force as fire retardant clothing offered no protection against flames.

Hawkins warned that these and “thousands of items” sold by Dakota Outerwear and California Surplus made it to airmen deployed overseas.

Other bogus duds included fake multicam trousers, parkas, rain suits, and ponchos that failed to disrupt infrared scanners. Units were ordered to seize them worldwide, according to a Government-Industry Data Exchange Program Problem Advisory issued in early 2020. 

Chinese counterfeiting scheme

US Air Force Airman Chelsea Kidman from the 790th Missile Security Forces Squadron Security Support Team checks the last item of her gear off the list as she receives new name tags and rank insignias Feb. 2, 2015, in the Peacekeeper High Bay on F.E. Warren Air Force Base, Wyoming. The new tags attach to the Operation Enduring Freedom Camouflage Pattern uniforms missile field defenders were issued. US Air Force photo by Airman 1st Class Brandon Valle.

Like a malignant octopus, his tentacles reaching into China, Pakistan, New York, and New Jersey, Kohanbash dabbled in all aspects of the conspiracy, including the manufacturing, smuggling, and transportation of the counterfeit goods.

To cover it all up, he lied to the military and its contractors in the supply chain about the authenticity of the gear he sold and where it was made.

Federal investigators identified a dozen US businesses that suffered from the counterfeiting scheme. The corrupt contractors folded garments to conceal where trademarks should've been; hid their hangtags or repackaged and labeled goods to mask their true contents; and made sure “Made in China” stickers and markers could be easily removed before the troops ever saw them.

Portrayed in federal filings as a fat cat real estate baron with millions of dollars in New York property investments, Kohanbash was motivated to make a lot of money, investigators concluded.

Prosecutors urged the judge to send Kohanbash away for at least 51 months.

Chinese counterfeiting scheme

New Operation Enduring Freedom Camouflage Pattern uniforms line shelves in the Peacekeeper High Bay on F.E. Warren Air Force Base, Wyoming. The first set of Security Forces Airmen received the new uniforms Feb. 2, 2015, and will begin wearing the uniforms while traveling to the missile field Feb. 9, 2015. US Air Force photo by Airman 1st Class Brandon Valle.

Kohanbash asked for no time behind bars, largely so he could continue to care for his sick wife and repay taxpayers what he bilked from them.

In a letter he penned to the judge on Aug. 30, Kohanbash insisted that he, an Iranian refugee who left Shiraz in 1984 and traveled through Pakistan and Austria before arriving in Baltimore, remains grateful to the US for giving him the chance to “build a new life.”

“I am very embarrassed that I did things that were not honest,” Kohanbash wrote. “I always had a high standard that I tried to keep for myself because I am a father and I try to be a good example. I did something that was against everything I try to teach my children.”

The judge shaved 11 months off the prison sentence prosecutors requested.

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