High on the Colorado Plateau in northwestern New Mexico, a dusty main road runs through the Pueblo of Zuni. Pull over to the side, and someone in threadbare clothing will soon approach your window holding out a mysterious little box. In Los Angeles, where I live, such an offering could only mean trouble, and you'd be wise to roll up the window and make a quick getaway. But here in the homeland of the Zuni people, it's safe to take a look. The box is lined with soft cloth, and in it you'll find an exquisite creation this person made with his own hands—a travertine animal carving, silver earrings inlaid with the Zuni sun face motif, a corn maiden pendant of carved shell.

The Zuni people rely heavily on hard-won earnings from handmade jewelry and crafts. The tourism department of Zuni Pueblo estimates that 80 percent of working adults there make arts and crafts for sale. Yet it's getting harder and harder for them to make a living.

View Images Navajo jeweler Liz Wallace works on a piece in her studio in Santa Fe, New Mexico. Photograph by Maxine McBrinn

For as long as the Zunis and other indigenous artisans have sold their crafts, they've been undercut by fakes—nonnatives posing as Indians to sell more of their work, factory made goods sold as handmade. But today's fakes include a virtual torrent of knockoffs cheaply manufactured overseas and masquerading as genuine Native made—baskets made in Pakistan sold as Navajo, beadwork made in China sold as Plains Indian, Hopi katsina dolls cranked out in the Philippines—none more profitable than counterfeit Indian jewelry.

The insult isn't just financial. "Our arts and crafts give us a really concrete way to stay connected to our culture and our history," says Navajo jeweler Liz Wallace. "All this fake stuff feels like a very deep personal attack."

But even though the rampant sale of counterfeits in the Southwest has been widely acknowledged for decades—and has ties to organized crime, according to affidavits by federal investigators—only recently has the U.S. government taken any serious action to shut down the major operators. Whether the crackdown has teeth will be tested in New Mexico in April, when Albuquerque jewelry dealer Nael Ali will be sentenced for fraudulently selling imported jewelry as Native American made.

Exposing Fake Native American Jewelry Networks Two family networks have allegedly manufactured millions of dollars' worth of counterfeit Native American jewelry in factories in the Philippines, importing it to the U.S. to be sold as Native made. The Sterling Coalition The Khalaf family has owned and run Fashion Accessories 4 U since at least 2006. ASIA NORTH AMERICA PACIFIC OCEAN Importer Sterling Islands Albuquerque, New Mexico Manufacturer Fashion Accessories 4 U Cebu, Philippines From its hub in Albuquerque, New Mexico, Sterling Islands allegedly distributed the counterfeit goods to retail stores, though no members of the Sterling Coalition have yet been charged. Retail Stores Distribution hub: New Mexico Virginia Albuquerque Brambleton Gallup Colorado Breckenridge Santa Fe Aspen Arizona New York Scottsdale Tucson Verona United States Albuquerque The Aysheh Brothers The Aysheh family registered their Filipino factory, Imad’s Jewelry, in March 2014. ASIA NORTH AMERICA PACIFIC OCEAN Importer I Jewelers Wholesale Lodi, California Manufacturer Imad’s Jewelry Cebu, Philippines From its hub in Lodi, California, I Jewelers Wholesale distributed the counterfeit goods to retail stores, according to prosecutors. Retail Stores Distribution hub: New Mexico Alaska Albuquerque Ketchikan Gallup Colorado Santa Fe Breckenridge Texas Aspen California Fredericksburg Arizona Calistoga Tucson Lodi San Diego Canada Lodi United States 4 Mexico Exposing Fake Native American Jewelry Networks Two family networks have allegedly manufactured millions of dollars' worth of counterfeit Native American jewelry in factories in the Philippines, importing it to the U.S. to be sold as Native made. The Sterling Coalition The Aysheh Brothers The Khalaf family has owned and run Fashion Accessories 4 U since at least 2006. The Aysheh family registered their Filipino factory, Imad’s Jewelry, in March 2014. Importer I Jewelers Wholesale Lodi, California ASIA Importer: Sterling Islands Albuquerque, New Mexico Manufacturer Imad’s Jewelry Cebu, Philippines Importer Sterling Islands Albuquerque, New Mexico PACIFIC OCEAN Manufacturer Fashion Accessories 4 U Cebu, Philippines According to federal law enforcement, Sterling Islands, in Albuquerque, New Mexico, and I Jewelers Wholesale, in Lodi, California, imported the counterfeit goods and distributed them to retail stores throughout the United States. No members of the Sterling Coalition have yet been charged. Retail Stores Distribution hub: New Mexico Virginia California Calistoga Brambleton Albuquerque 1 Colorado Gallup Lodi San Diego Breckenridge Santa Fe Texas Aspen Arizona New York Scottsdale Fredericksburg Alaska Tucson Verona Canada Ketchikan 9 United States Lodi Albuquerque Mexico Clare Trainor, NGM STAFF

Ali, the owner of several retail stores in Albuquerque's Old Town district, pleaded guilty on October 18, 2017, to misrepresenting as Native-made jewelry sourced from two family-run networks he said were supplying him with counterfeit jewelry made in the Philippines. These two networks make for the largest Native American art fraud conspiracy ever brought to light.

Ali's sentencing is the first in the ongoing federal investigation called Operation Al Zuni, which began in March 2012, and is the most extensive ever conducted into Native American art fraud.

The investigation was named Operation Al Zuni after Al Zuni Global Jewelry, a well-known business in Gallup, New Mexico, owned by Nashat Khalaf, a Palestinian immigrant and prominent Indian arts dealer. Al Zuni, which claims to be the “largest wholesaler of Indian jewelry serving the Southwest since 1977," has its storefront in Gallup but also sells at gem and jewelry trade shows where retailers from all over the country buy inventory.

Misrepresenting arts and crafts, including jewelry, for sale as Native made when they’re not is a federal crime under a law passed in 1935 called the Indian Arts and Crafts Act. The act provides for penalties of up to $250,000 and five years in jail for first time offenders, but until now it has rarely been enforced. Federal law also requires that “Indian-style” products imported into the United States be permanently marked with the country of origin. That law too has been widely flouted.

View Images Billboards along Highway 40 in Arizona and New Mexico tout indigenous-made arts and crafts, from pottery and rugs to moccasins and jewelry. Photograph by Maraya Cornell

It has been estimated that the Native American arts and crafts industry brings in more than a billion in gross sales annually nationwide. And although many would say that not enough profits have ever reached the artists, the sale of handmade jewelry, baskets, pottery, carved figurines, beaded leather, and other crafts provide livelihoods for thousands of indigenous people.

According to federal investigators, the two families running counterfeiting networks are both Palestinian, known to law enforcement as the Sterling Coalition and the Aysheh brothers. The Sterling Coalition, the larger of the two, operates an importing company in Albuquerque called Sterling Islands, which is owned by Nashat Khalaf’s brother, Jawad Khalaf, and niece, Sheda Khalaf.

In affidavits filed in support of 18 search warrants executed in October of 2015, investigators name these and other members of the Khalaf family, and associates, as participants in a scheme to import and fraudulently sell counterfeit Native American jewelry manufactured in a factory in the Philippines called “Fashion Accessories 4 U.” Jawad Khalaf and his son, Nader, have owned the factory since at least 2006. None of the Khalafs has been charged yet.

Albuquerque lawyer John Boyd, who represents Nashat Khalaf and Al Zuni Global Jewelry, calls the allegations against his client "wrong." The business and its owner, he said in an email, "have supported Native American artisans for decades, maintain good relationships with them and provide the most important outlet in the area for Native Americans to sell their work. Al Zuni and Khalaf deny that they have ever attempted to pass off or have passed off any jewelry as Native American, Navajo, Zuni, Hopi, or any other tribe, when it is not."

Mark Baker, another Albuquerque lawyer, who represents Jawad Khalaf and Sterling Islands, emailed that his clients "certainly deny that they violated the law or otherwise engaged in any deceitful conduct. This is a family of people known in the community as honest and responsible."

Law enforcement estimates that Sterling Islands has imported into the U.S. contraband jewelry worth $11,800,000 in wholesale value between October 2010 and October 2015. According to court records, retail buyers and wholesalers would place orders for replicas of particular pieces of genuine jewelry and pick them up at Sterling Islands.

The four Aysheh brothers running the other alleged conspiracy—Imad, Nedal, Iyad, and Raed—were charged in February 2017. Their trial is scheduled for October of this year. None has yet entered a plea.

View Images Zuni jeweler Roxanne Seoutewa uses a flint spark lighter to fire up her torch in preparation for soldering hand-formed bezels to a silver sheet. Later she’ll fit in the tiny stones she’s cut and sanded. Photograph by Maraya Cornell

In October 2015, when Operation Al Zuni went public, 11 jewelry and Indian arts stores were raided in New Mexico and California, including two of Nael Ali's Albuquerque stores, Gallup 8 and Galleria Azul. The Indian Arts and Crafts Board estimated in 2016 that the retail value of the 350,000 pieces of jewelry seized during the raid exceeded $35 million.

Operation Al Zuni was conducted by the Office of Law Enforcement for the Southwest Region of the U.S. Fish and Wildlife Service and funded through an agreement with the Indian Arts and Crafts Board, an agency within the U.S. Department of the Interior tasked with developing and promoting arts and crafts as a source of income for American Indians and Alaska Natives, as well as with enforcing the Indian Arts and Crafts Act.

Made by Indians?

In the Pueblo of Zuni, jeweler Roxanne Seoutewa sits in a folding chair at a cramped desk in a well-worn trailer, soldering tiny hand-made bezels to a piece of silver sheet. Into the bezels she'll fit the seed-like stones she's cut, sanded, and polished to form the close, stitch-like pattern known as needlepoint and recognized by collectors the world over as one of the classic Zuni styles of handmade jewelry.

View Images This miniature silver canteen, photographed by investigators at Al Zuni Global Jewelry, was sold to an undercover agent as Navajo made on November 24, 2014. Two years before, 20 identical canteens were found in a shipment from Fashion Accessories 4 U in the Philippines. Photograph by U.S. Fish and Wildlife Service, AP

Compared to artisans trying to sell their work on the street, Seoutewa is doing well. But she has to go farther and farther from home to get a decent price for her work. She doesn’t sell to the local shops in Zuni anymore, or even to the wholesalers 40 miles away in Gallup. The problem, she says, is all the cheaply made foreign imports illegally sold as Zuni handmade.

It was the arrival of the railroads in the Southwest at the turn of the 20th century that set off a roaring business in indigenous art and crafts, and the industry has been a defining presence in the Southwest ever since.

And it was a boom in the tourist industry along Route 66 in the 1960s and 70s that attracted fortune-seekers from the Israeli-occupied Palestinian West Bank. In 1972 Nashat Khalaf and three of his brothers were among the first to arrive in Gallup, the wholesale center for the arts and crafts produced on nearby Indian reservations. They opened a business selling Zuni jewelry, calling it Al-Zuni Traders. As Khalaf told Al Jazeera years later, he and his brothers had such instant success in the jewelry business that they “called everybody” back home. “It was a bonanza,” he said. “It was a gold rush, and they all came here.” By 2002 several hundred Palestinians had settled in Gallup, most reportedly in the Indian jewelry business.

Today road trippers driving Interstate 40 through Arizona and New Mexico are bombarded with billboards hawking crafts “MADE BY INDIANS.” Much of what's for sale hasn't been made by Indians at all. Even Santa Fe, regarded as the heart of the high-end Indian art market with its world-renowned plaza shopping district, is rife with forgeries—so much so that the city recently announced an ordinance to try to rein in the fraud.

Higher-end jewelry knockoffs are copied from one-of-a-kind pieces by master Indian artisans and stamped with initials and symbols to mimic an artist’s hallmark. In stores the fakes are often mixed in with genuine pieces but sold at a discount, forcing jewelers who painstakingly craft each piece by hand to compete with counterfeits produced in sweatshops.

View Images Navajo silversmith Aaron Anderson, of Gallup, New Mexico, holds out a tufa stone negative he’s carved, which serves as both the mold for a belt buckle and a guarantee of authenticity for the buyer. Photograph by Maraya Cornell

The Indian Arts and Crafts Board collects complaints about potential violations of the Indian Arts and Crafts Act, but without a law enforcement bureau of its own, the board must rely on other agencies to investigate complaints. In 1990 a major overhaul of the act increased penalties for violations and gave the FBI primary responsibility for enforcing the law. But the FBI had other priorities, and the bureau generally declined referrals of potential violations from the board, according to a report by the Government Accountability Office.

By late 2011 when the Fish and Wildlife Service agreed to look into fraudulently sold Indian arts and crafts, no jewelry dealers, or large-scale dealers in Indian arts and crafts of any kind, had been charged under the act. On several occasions during the 1990s and 2000s, New Mexico attorneys general sued jewelry stores in Santa Fe and Albuquerque, including several dealers identified by Operation Al Zuni as selling the Sterling Coalition’s Philippine counterfeits, but their suppliers were never identified. And even though the rampant sale of counterfeits in Arizona and New Mexico has been widely acknowledged for decades, no major counterfeiters had ever been charged.

Yet federal law enforcement had been alerted to at least one potential supplier as early as 1994, when the Arizona law firm Kirkpatrick & Kramer wrote to a Department of the Interior investigator on behalf of Hopi jeweler Jason Takala warning that “an outfit in eastern Gallup, New Mexico named ‘Al Zuni’ is mass-producing copies of original Native American jewelry.”

It wasn’t until nearly two decades later, after the Fish and Wildlife Service had taken over enforcement of the Indian Arts and Crafts Act, that a piece of counterfeit Indian jewelry in a retail store was traced back to the Khalafs.

Making the Case

On November 26, 2012, a Monday, Fish and Wildlife Service Special Agent Russell Stanford walked into Gallery 8, an upscale jewelry shop in Albuquerque owned by Nael Ali. Posing as a jewelry dealer, Stanford bought two rings stamped with the initials CK, which the clerk told him stood for the Navajo artist Calvin Kee, according to court records. (There is no known Navajo jeweler named Calvin Kee.)

View Images Ultraviolet light exposes otherwise invisible markings on a ring sold as Navajo made by Gallery 8, in Old Town Albuquerque, New Mexico. Special Agent Russell Stanford marked the ring when he intercepted a UPS shipment full of jewelry imported from Fashion Accessories 4 U in the Philippines. Photograph by U.S. Fish and Wildlife Service, AP

Later Stanford looked at the ring under an ultraviolet light and confirmed that it had come from the Khalafs’ factory in the Philippines: There were the dabs of otherwise invisible ink he’d applied to the ring two and a half months before when he intercepted a shipment of jewelry coming in from Fashion Accessories 4 U and bound for Sterling Islands.

In just months Stanford, working as the sole investigator on Operation Al Zuni (a second agent wasn't added until June 2014) had done what no federal investigator had yet been able to do: substantiate a source for the high-end counterfeits that had been turning up in retail stores for decades.

Less than 30 days later, Gallery 8 was featured in a Christmas shopping guide in the Albuquerque Journal. Nael Ali claimed that he purchased all his jewelry, except for the Polish amber jewelry, directly from Native artists. “There’s no middleman for me,” he said.

Ali, along with Mohammad Manasra, a traveling jewelry seller (who Ali admitted in his plea agreement was indeed his middleman) were arrested in October 2015 in Operation Al Zuni’s initial take-down and became the first jewelry dealers ever to be charged with violating the Indian Arts and Crafts Act. (The charge against Manasra has been reduced to a misdemeanor, and he isn’t facing incarceration.)

In Nael Ali’s plea agreement, filed October 18, 2017, he admitted that the Philippine-based factories run by the Khalafs and the Aysheh brothers were the sources of counterfeits (some supplied through Mohammad Manasra) that he was fraudulently selling as Native made at Gallery 8 and at Galleria Azul, another store in Albuquerque. Ali confessed to mixing the knockoff jewelry with genuine Indian-made jewelry and ensuring “that none of the Philippine-made jewelry was marked with its country of origin.”

Taking Out the Thorn

The ongoing prosecutions against the alleged fraudsters in New Mexico are sending shockwaves through the Indian arts and crafts industry. Nidal Abdeljawad of All Tribes Trading Post, an Indian arts store in the Pueblo of Zuni, claims that Nashat Khalaf’s Al Zuni Global Jewelry supplies 90 percent of the retail stores in the U.S. that deal in Native art. “If this guy has to close his shop, it will be a disaster for the Native Americans,” Abdeljawad says.

View Images On the remote Zuni reservation in northwestern New Mexico, an estimated 80 percent of working adults make jewelry, pottery, stone animal carvings, or other arts and crafts for sale to tourists and dealers. Photograph by Maraya Cornell

Other Southwest dealers fear that prosecutions against business owners accused of peddling fakes make for bad publicity and that customers and collectors, concerned about getting ripped off, will avoid shopping for Indian arts and crafts altogether.

Justin Winfield, of Winfield Trading Company, a large buyer of Indian jewelry and crafts located on the highway between Gallup and Zuni, disagrees. Fanning out the thick stack of newspaper articles he’d collected since October 2015, he told me last July that he thought the ongoing prosecutions were already having a “positive impact”—that buyers for retail stores were taking greater care to ensure authenticity.

A few spooked customers in the short-term is a price Winfield is willing to pay if it means curbing the influx of fakes. “It hurts to take the thorn out,” he said. “But after it’s out, you can heal up.”

William Woody, who championed his agency’s investigations into Indian arts and crafts fraud when he was chief of law enforcement at the Fish and Wildlife Service, thinks Operation Al Zuni has “just scratched the surface.” At a Senate field hearing last July—Woody’s final day on the job—he said, “We have not begun to take a comprehensive look into the markets for other Native American items in the Southwest, including pottery, paintings, blankets, etc., where there is likely similar fraudulent activity.”

"In order for things to change,” wrote the editors of the Gallup Independent in October 2017, "the federal government, as well as attorneys general in states like New Mexico and Arizona, must get a lot tougher on these frauds.”

The sentencings of Nael Ali and Mohammad Manasra, who have confessed to knowingly dealing in fakes from both alleged networks, will test how tough New Mexico judges are willing to be. Manasra isn’t facing prison time. But Ali, who pleaded guilty to a felony, faces up to 18 months in prison and could be the first person ever to go to jail for violating the Indian Arts and Crafts Act.

Prosecutors have requested that the sentencing in Albuquerque of Ali and his co-defendant, Mohammad Manasra, be on the same day in April so that any Native American artisans who wish to be heard by the court won’t have to travel twice. "Now's the time for these artists to come forward," says Special Agent in Charge Nicholas Chavez, who supervised the Fish and Wildlife Service's investigation.

She Fears Her Tribe's Story Will Be Forgotten Filmmaker Kayla Briët explores her Prairie Band Potawatomi roots through the teachings of her father. Weaving together the history, language, dance, and music of her tribe, Briët keeps her family's heritage alive and celebrates the beauty of culture.