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Consumer Alert: Conman makes millions selling counterfeit computer chips


If you are thinking about buying any parts for your computer, be careful. One conman made a killing selling counterfeit chips.

"He would purchase the chips for about $2.00 apiece in China and sell them in the U.S. for several hundred dollars," says U.S. Postal Inspector Alex Sylvester.

The mastermind, Ronald Graban, realized he could make a very healthy profit.

"He had inside information on exact serial numbers that Cisco and Nortel use. So, when he requested labels from China they would put those exact numbers on there to try and hide they were counterfeit chips," say Sylvester.

Graban would then sell them to a third party retailer.

"It was reported to be a refurbished Cisco and Nortel product, but in fact it wasn't. It was a counterfeit product from China," says Sylvester.

Business was good. In fact, authorities say Graban made more than $3 million with his slight of hand until the chips began to malfunction.

"The customer would go back to Cisco and Nortel and request a refund. And Cisco and Nortel would check their records and discover they never sold them to that customer," says Sylvester.

At the same time, border patrol agents began to see more chips and separate labels coming into the country and called postal inspectors.

"If you're going to purchase anything like a GB or any other computer component, we suggest going to the manufacturer directly. If not, there are several suppliers that are all legitimate and do offer warranties on products," says Sylvester.

Graban was caught and pleaded guilty to mail fraud and money laundering. He faces 20 years in prison on mail fraud charges and ten on money laundering. He is still awaiting sentencing.


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