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Intellectual Property Rights

Indonesian man pleads guilty to selling illegally modified gaming devices

CLEVELAND – An Indonesian man pleaded guilty Wednesday to violating digital copyright laws by manufacturing and selling various modification chips used in popular gaming consoles. The conviction follows an investigation by U.S. Immigration and Customs Enforcement's (ICE) Homeland Security Investigations (HSI).

Cristiano Budiman, a citizen of Indonesia, pleaded guilty to one count of violating the Digital Millennium Copyright Act and one count of committing criminal copyright infringement. He faces up to 10 years in prison, a fine of $750,000 and six years of supervised release.

"Some may be under the false impression that intellectual property right violations are victimless crimes," said Brian M. Moskowitz, special agent in charge of ICE HSI Michigan and Ohio. "These types of crimes collectively cost U.S. businesses billions of dollars a year in lost revenue, which translates into lost jobs. In addition, these losses are often passed down to the consumer in the form of higher prices."

Budiman was indicted April 3 after an investigation by Cleveland-based HSI special agents revealed he was selling the various modification chips through his website www.DrModchip.com. These illegal devices are used to circumvent copyright security features in popular gaming consoles like the Sony PlayStation 2, Microsoft Xbox and Xbox 360, and the Nintendo Wii. The chips allow the user to play illegally downloaded, counterfeit and/or pirated video games. The investigation also revealed that Budiman was selling counterfeit video games that were compatible with his modified chips.

This case is part of a larger operation aimed at intellectual property theft in numerous states around the country. On August 1, 2007, HSI Michigan and Ohio coordinated the national takedown of 32 commercial websites that were involved in the international sale and distribution of illegal circumvention devices. As a result of the operation, federal search warrants were executed at businesses, storefronts and residences in New York, Massachusetts, Minnesota, North Carolina, South Carolina, Hawaii, Ohio, Wisconsin, Maryland, Idaho, Michigan, Illinois, Florida, Texas, Pennsylvania and California. The operation resulted in the seizure of records, computers and illegal circumvention devices at the various locations.

The investigation was the result of a year-long undercover operation titled "Operation Tangled Web" involving 22 domestic HSI field offices and the HSI Cyber Crimes Center. The Entertainment Software Association, Sony Corporation of America, Microsoft Corporation and Nintendo of America Inc., all provided technical expertise to the HSI Michigan and Ohio office.

Budiman is scheduled to be sentenced Aug. 1.

This investigation was supported by the HSI-led National Intellectual Property Rights Coordination Center (IPR Center) in Washington. The IPR Center is one of the U.S. government's key weapons in the fight against criminal counterfeiting and piracy. As a task force, the IPR Center uses the expertise of its 20 member agencies to share information, develop initiatives, coordinate enforcement actions and conduct investigations related to IP theft. Through this strategic interagency partnership, the IPR Center protects the public's health and safety, the U.S. economy and our war fighters.