Zug prosecutors drop probe into counterfeit shop after millions moved

Prosecutors in the canton of Zug have closed a money laundering investigation into an online shop that sold counterfeit luxury goods, despite 5.4 million francs flowing through the company’s account and 2.9 million francs being transferred to two people in China, according to an investigation by SRF Investigativ.

The shop, Deluxerep, sold imitations of Prada, Balenciaga and Versace products at prices far below those of the originals. Its operators advertised through the social media channel “szene_ isch_zueri”, which has hundreds of thousands of followers on Instagram, Telegram and TikTok.

Between 2020 and 2023, 5.4 million francs were paid into the account of Prem1um GmbH, the company behind the shop, which was based in Baar in the canton of Zug. A further 2.9 million francs was transferred to two people in China.

UBS filed a suspicious activity report with Switzerland’s money laundering reporting office in summer 2023. The Zug public prosecutor’s office then opened criminal proceedings against the company’s managing directors, a man in his mid-20s from eastern Switzerland and a business partner in his early 20s who is now registered as living in the canton of Zug.

The investigation also concerned serious violations of trademark law. However, the authorities closed the case in December 2024. The prosecutors said Deluxerep was offline when they received the suspicious activity report. They also said police inquiries indicated that the accused had not operated from the canton of Zug, while leaving open how police had reached that conclusion.

The prosecutors concluded that it was not possible to investigate the counterfeit goods or money laundering suspicions in a targeted way. The decision does not state whether the accused were questioned, whether their homes were searched or whether their phones were seized.

Marc Wullschleger, president of Stop Piracy, an association that campaigns against counterfeit goods, told SRF that the decision was difficult to understand. He said it appeared that the public prosecutor’s office had wanted to close the case quickly and avoid pursuing questions about jurisdiction.

Deluxerep also faced legal action in the United States. In April 2023, a Florida court upheld a trademark lawsuit brought by Adidas against the shop and numerous other online retailers. The court banned Deluxerep from continuing to use Adidas’s name and logo and ordered it to pay 1 million US dollars in damages. In 2022, the same court had upheld a lawsuit by Chanel and also prohibited the shop from using that brand.

After a name change, Deluxerep operated as Deluxeside. The shop continued to advertise through “szene_ isch_zueri”, a channel that SRF Investigativ previously reported had sold its reach to advertisers despite repeatedly attracting criticism over violent, voyeuristic and privacy-infringing content.