5 Family Members Sentenced to Prison For $50 Million Cell Phone Scam
Five members of a family have been sentenced to federal prison for a counterfeit cell phone scam involving over $50 million.
According to an official release from the IRS, Pavel Babichenko, Piotr Babichenko, Timofey Babichenko, David Bibikov, and Mikhail Iyerusalimets were found guilty by a jury in August 2022. Now, all five defendants have had their prison sentences handed down by Senior U.S. District Judge B. Lynn Winmill.
The group was convicted of conspiracy to commit wire fraud, mail fraud, and conspiracy to traffic in counterfeit trademarked goods for selling branded counterfeit cell phones via online marketplaces like Amazon and eBay.
The IRS shared that the defendants scammed buyers by advertising the electronics as new, authentic Apple and Samsung products. In reality, the counterfeit smartphones and accessories were purchased in bulk from manufacturers in Hong Kong and repackaged by the family in Treasure Valley, Idaho before being listed online.
In total, the Babichenkos, Bibikov, and Iyerusalimets earned over $50 million from their counterfeiting scheme.
Their prison sentences are as follows:
1. Pavel Babichenko - 72 months in federal prison, a $21,000 fine, and three years of supervised release. A $33,708,700.30 forfeiture money judgment was also entered.
2. Piotr Babichenko - 48 months in federal prison, a $10,000 fine, and three years of supervised release. A $3,316,882.40 forfeiture money judgment was also entered.
3. Timofey Babichenko - 48 months in federal prison, a $10,500 fine, and three years of supervised release. A $9,230,196.82 forfeiture money judgment was also entered.
4. David Bibikov - One month in federal prison, nine months of home detention, and three years of supervised release. A $4,710,207.11 forfeiture money judgment was also entered.
5. Mikhail Iyerusalimets - Two months in federal prison, nine months of home detention, and three years of supervised release. A $953,411.95 forfeiture money judgment was also entered.
"These sentencings are the result of law enforcement's unrelenting work to dismantle transnational criminal organizations," noted Acting Special Agent in Charge Cheyvoryea Gibson of the Salt Lake City FBI. "With strong partnerships in Idaho and around the world, the FBI stands firm in combatting those who attempt to defraud U.S. citizens and U.S. companies for their financial gain."
U.S. Attorney Josh Hurwit also commented on the convictions, saying, "My Office is committed to protecting Idaho consumers, businesses, and the public from fraud of all types. The convictions, sentences, and financial recovery in this case reflects our ability to work with our law enforcement partners to take down large-scale and long-term fraud enterprises that cross borders."
What do you think about this massive counterfeiting scam?
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