KANSAS CITY, Mo. – a Chinese national was indicted by a federal grand jury today for his role in an international, multi-million dollar software piracy scheme.
Wen Tao Liu, also known as Orland Liu, 36, a citizen of the People’s Republic of China, was charged in a four-count indictment returned by a federal grand jury in Kansas City, Mo. Today’s indictment replaces a federal criminal complaint filed against Liu on June 13, 2016, and contains additional charges. Liu, who was arrested on June 15, 2016, at Dallas Fort Worth International airport on an American Airlines flight during his return flight to China, remains in federal custody.
Today’s indictment alleges that Liu, doing business as Haitu International Group Co. Limited (an entity based in Hong Kong), participated in a conspiracy from March 10, 2010, to Feb. 2, 2015, to commit the offenses of unauthorized solicitation of access devices, trafficking in counterfeit goods and smuggling goods into the United States.
Liu allegedly obtained and sold counterfeit, illicit, and/or unauthorized Microsoft software, software products and related components, including unauthorized product key codes and counterfeit product key cards, causing the Microsoft Corporation millions of dollars in losses.
According to an affidavit filed in support of the original criminal complaint, investigators identified at least 4,659 individual product activation key codes distributed by Liu to various resellers across the United States, which were collectively activated over 36,000 times. Microsoft had already blocked 1,111 of those keys due to suspicions of piracy and 2,267 of the keys were already identified in the course of other Microsoft fraud investigations. Microsoft’s loss from the repeated activations of the 4,659 product keys could total approximately $9 million.
Liu allegedly acquired unauthorized product key codes and counterfeit product key cards for Microsoft software from others within the People’s Republic of China. According to the indictment, Liu supplied them to Kansas City, Mo., resident Casey Ross, Damascus, Md., resident Reza Davachi and numerous other individuals across the country. Co-conspirators in the United States, the indictment says, then resold these unauthorized product key codes and counterfeit product key cards for Microsoft software products to unsuspecting customers through their companies and affiliated Web sites.
For example, the indictment cites 105 wire transfers, totaling approximately $1,591,193, made to Liu by an unnamed co-conspirator in Florida for the purchase of unauthorized product key codes and counterfeit Microsoft Office “Lenovo” product key cards between April 14, 2014, and Feb. 10, 2015.
In addition to the conspiracy, today’s indictment charges Liu with one count of trafficking in counterfeit goods. According to the indictment, an undercover agent purchased 500 counterfeit Microsoft Office “Lenovo” product key cards from Liu for $35,000. Liu is also charged with one count of smuggling goods into the United States and one count of the entry of goods by means of false statements. According to the indictment, Liu smuggled the 500 counterfeit Microsoft Office “Lenovo” product key cards into the United States by shipping them in packages that falsely labeled them as gift cards with a total declared value of $50.