Two Chinese language nationals have been sentenced to jail for scamming Apple out of greater than $2.5 million after exchanging over 6,000 counterfeit iPhones for genuine ones.
Between July 2017 and December 2019, Haotian Solar, Pengfei Xue, and their co-conspirators, Wen Jin Gao and Dian Luo, exploited Apple’s system substitute coverage to interchange non-functioning pretend iPhones for real gadgets.
Their objective was to “unjustly enrich themselves by fraudulently acquiring genuine iPhones from Apple after submitting inauthentic iPhones to Apple for restore and substitute,” in line with the courtroom paperwork.
The counterfeit iPhones have been shipped from Hong Kong to industrial mail receiving company (CMRA) mailboxes in United Parcel Service (UPS) shops in the US. To open these mailboxes, they used their precise college identification playing cards and driver’s licenses.
As found by the investigators, they submitted these pretend iPhones with spoofed IMEIs and serial numbers to Apple retail shops and Apple Licensed Service Suppliers.
Apple despatched them substitute iPhones through personal and industrial interstate carriers (together with FedEx, DLH, and UPS). The gadgets have been then shipped again to Hong Kong, the place they have been bought, and the proceeds have been shared among the many conspirators.
Their return fraud scheme was potential as a result of Apple prospects can return defective iPhones through mail, at Apple retail shops, or via Apple Licensed Service Suppliers and alternate them for brand new ones inside one 12 months of buy underneath the corporate’s guarantee service and handset substitute program.
“Members of the conspiracy submitted greater than 6,000 inauthentic telephones to Apple through the conspiracy, inflicting a lack of greater than $2.5 million,” the Justice Division mentioned in a press launch revealed right this moment.
Solar and Xue have been arrested by U.S. postal inspectors in December 2019 and have been each convicted of mail fraud and conspiracy to commit mail fraud in February.
Solar was sentenced to 57 months in jail and three years of supervised launch, whereas Xue obtained a 54-month jail sentence adopted by three years of supervised launch. The courtroom additionally ordered them to pay Apple $1,072,200 and $397,800 in restitution, respectively.