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Man Who Duped Apple into Replacing Fake iPhones for Authentic Devices Worth $1 Million Convicted and Sentenced
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I'm sure he was thinking, "I like money".
Related anecdote that should have made MacRumors:
A few years I was sound asleep at 3AM, when suddenly awakened by *bang bang bang* "THIS IS THE FBI, COME OUT WITH YOUR HANDS OVER YOUR HEAD", which scared the living $&*% out of me.
I went and poked my head out into the hall to see my neighbor and his girlfriend-of-the-week on the floor in their underwear being handcuffed by a dozen police officers, while FBI agents raided their unit.
It turns out this guy had been:
1. Using fraudulent financial statements to qualify for millions of dollars in loans.
2. Using the money to buy iPhones by the pallet.
3. Replacing the iPhones with broken tiles.
4. Shipping the "iPhones" to the Middle East.
5. Filing insurance claims that the phones were stolen in transit.
6. Reporting no income to the IRS (despite flaunting his Ferrari and expensive lifestyle on Instagram).
This guy got hit with tax fraud, insurance fraud, bank fraud, wire fraud - Apple sued him, he got hit with the book.
Now he is behind bars and they seized everything he owns. His parents were implicated too, since he was running the operation out of their garage.
I'm not sure how these guys think they can get away with committing the same crime over and over without somebody eventually catching on.
A few years I was sound asleep at 3AM, when suddenly awakened by *bang bang bang* "THIS IS THE FBI, COME OUT WITH YOUR HANDS OVER YOUR HEAD", which scared the living $&*% out of me.
I went and poked my head out into the hall to see my neighbor and his girlfriend-of-the-week on the floor in their underwear being handcuffed by a dozen police officers, while FBI agents raided their unit.
It turns out this guy had been:
1. Using fraudulent financial statements to qualify for millions of dollars in loans.
2. Using the money to buy iPhones by the pallet.
3. Replacing the iPhones with broken tiles.
4. Shipping the "iPhones" to the Middle East.
5. Filing insurance claims that the phones were stolen in transit.
6. Reporting no income to the IRS (despite flaunting his Ferrari and expensive lifestyle on Instagram).
This guy got hit with tax fraud, insurance fraud, bank fraud, wire fraud - Apple sued him, he got hit with the book.
Now he is behind bars and they seized everything he owns. His parents were implicated too, since he was running the operation out of their garage.
I'm not sure how these guys think they can get away with committing the same crime over and over without somebody eventually catching on.
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Isn´t this same guy who receives like $100 for every iPhone sent to HK, and those refurbished iPhones sell for like $600???
"time served" so the time spent in prison is the same as if he had been aquited.
I doubt that leniency would apply to potentially counterfeit products - otherwise, why would they even check on that? Counterfeit products are a highly serious, criminal issue. This isn't the same thing as, say, giving the customer the benefit of the doubt about how damage occurred, etc.
That's why I said if they knew it was reported as counterfeit. If so, then they need to get a 2nd opinion from someone who has the final say. It's not like they even have to tell the customer that. They can do it discreetly. "I'll be right back, sir, I just need to check on something".
It seems that you might be assuming that the phones were easily determined to be fake, with no room for uncertainty.
The evidence would suggest that these fakes were Not easy to determine.
Probably thought they could get a not insignificant chunk of side money for relatively small risk since a large company like Apple would just eat the cost rather than investigate. I doubt this person is the main culprit though. There are probably operations around the world and these are the only ones they could track down in the U.S. while the main instigators are in Hong Kong.
That's not how Apple Store repair works. They run a software check to determine if a phone is real and damage free (impossible to do with a bricked phone) so the only thing they could do to check for the legitimacy is the serial/IMEI and see if the outer shell looks like an authentic unit. Repairs, especially for bricked phones, are likely shipped to repair centers rather than fixed in-store and customers would just be handed a new unit. So by the time Apple can verify it's a fake, it's already too late to reject the repair or track down the customer.
I'm just going off what the other guy said. My main point is I doubt anyone at Apple was suspecting the phones were counterfeit and then just saying "whatever".
It’s such a wasted opportunity though. You know how many people are waiting for years to migrate to the US and can’t make any progress? The worst part is this adds an extra layer of scrutiny for anyone from his region intending to study in the US.
I worked for AppleCare back around this time and I remember at one point, I could count on seeing this scam at least a few times a day. Always the same copy/pasted "my iPhone is bricked, I want to do an express replacement"(paraphrased). It resulted in policy changes regarding who was eligible for an express replacement, and ultimately it become AppleCare-only (which I'm sure this contributed to).
So this is what "Homeland Security" does? Protect corporations from losing money? I guess since there's no real terrorist threat, that huge bureaucracy has to find something to do.
I don’t think this is common to affect immigration policy. Besides, it sounds like he already got his green card when he decided to do this, so it’s not like he was trying to study in the US or get PR just to do these scams.
Apple would have known immediately that something was wrong as soon as the first lot of phones came in for repair. I used to work for a company that did warranty repair work for Packard Bell laptops and I can tell you from first hand experience in that if we saw something dodgey or not quite right with a laptop that came in for warranty repair it was immediately reported to the repair supervisor/manager who would then investigate it further. Assuming the same type of policy and process is installed at Apple, the first iphone comming in from this criminal group would have been flagged straight away.
The only way this could have gone unoticed by Apple for so long would be if this criminal gang had people on the inside of Apples repair center who would intercept the iphones as they came in and processed them.
The only way this could have gone unoticed by Apple for so long would be if this criminal gang had people on the inside of Apples repair center who would intercept the iphones as they came in and processed them.
Its amazing how people put effort and talent to do things the wrong way, why not invest it in legal ways? reminds me of cheating students in schools.
That being said, I assumed Apple had a mechanism to check if the device is legit like connecting it to a machine or something.
That being said, I assumed Apple had a mechanism to check if the device is legit like connecting it to a machine or something.
