We've seen scams like this before, but this particular case is of colossal industry proportions. Five people were charged with fraud for their role in a counterfeit iPhone return scheme.
Essentially, people brought nearly worthless counterfeit iPhone models to the Apple Store, claiming they were defective and asking for them to be returned. replacement device. Apple will exchange this device for a valuable phone, which can then be sold. This procedure was allegedly carried out 16,000 times.
The case file estimates that Apple's losses from this scheme amounted to at least $12.3 million. The returned devices included thousands of iPhones, iPads and other Apple devices.
According to the indictment, the scheme operated from December 2014 to March 2024 in coordination with groups in China, from where the counterfeit devices were purchased.
The counterfeit models used stolen ID numbers to make the phones appear to be real Apple products sold in the United States, owned by real people, and covered by the AppleCare warranty. It's entirely possible that the crime inadvertently deprived genuine customers of the ability to claim legitimate warranty repairs because Apple's systems had already pre-processed the model IDs.
To cover their tracks, the co-conspirators demanded repairs at multiple Apple retail stores throughout California, visiting up to ten stores in a single day. These individuals allegedly used fake addresses and aliases, rented mailboxes and other tactics.
The case has now gone to trial. If found guilty, the defendants face years in prison on each of the 22 counts; including wire fraud, mail fraud, aggravated identity theft, and trafficking in counterfeit products.
