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Compaq continues attack on fake parts (Oxygen Electronics and Brokerlynx featured in Electronic Buyers News)
For immediate release - Monday, November 11, 2002
Laurie Sullivan
11/11/2002 10:00 AM EST
Dynasty Memory Inc. executive Tony Minh Nguyen was arraigned last Monday on charges that he manufactured and trafficked in counterfeit Compaq Computer Corp. memory modules.

Nguyen appeared before a Santa Ana, Calif., federal grand jury Oct. 28 and was released on $25,000 bond after pleading not guilty, said Tom McConville, assistant United States attorney for the U.S. Attorney's Office in the Central District of California.

The investigation of Dynasty, a distributor based in Santa Ana that has now gone out of business, began in early 2001, when Compaq alerted the FBI after consumers began returning parts that the OEM believed were counterfeit.

The two-count indictment alleges that Nguyen directed Dynasty employees to purchase out-of-date Compaq memory components and remove the Compaq labels. Under Nguyen's direction, employees were then allegedly ordered to re-adhere the labels to non-Compaq memory components. As a result, the distributor created counterfeit material that was almost indistinguishable from genuine Compaq parts, according to court documents.

If convicted of both charges, Nguyen faces a statutory maximum penalty of 20 years in federal prison and fines of up to $4 million. The indictment alleges the scheme dates back to August 2000.

This isn't the first time Compaq has acted against distributors and resellers the company believed were engaged in illegal activities.

Last year, Compaq, in conjunction with the U.S. Marshals Service, the FBI, and the U.S. Attorney General's office, carried out a search and seizure operation that resulted in arrests at Hardware 4 Less Inc., Bow, N.H. Several million dollars worth of allegedly fake Compaq computer parts that Hardware 4 Less had manufactured and intended to sell to the public were seized. Neither Hardware 4 Less nor Dynasty was an authorized Compaq reseller.

Independent distributor Oxygen Electronics, Guilford, Conn., said that since launching a Website for distributors in September to monitor possible counterfeit activity, it has received a number of troubling reports.

"Since the inception of Brokerlynx, companies have identified and posted more than 28 specific [counterfeit] part numbers," said Mark Pasdon, Oxygen's managing partner. "We've also had a significant number of companies reporting wire fraud and other disreputable business practices. Our hope is that Brokerlynx will enable our industry to protect itself and its clients from losses associated with these risks and reverse the current trend we see in counterfeiting."
Oxygen Electronics LLC
56 Lafayette Ave.
White Plains, NY 10603
Phone: +1-914-289-0202
Fax: +1-914-289-0222