College students allegedly scammed Apple out of nearly $1M in iPhone replacements

Sankari · 7 Apr 2019 at 00:44

Two Chinese students living in the USA successfully scammed Apple by submitting fake iPhones for repair or replacement. Apple couldn't tell the difference.

Two Chinese engineering students in Oregon allegedly scammed Apple out of hundreds of thousands of dollars in iPhone replacements and are now facing criminal charges in federal court, as first reported by The Oregonian. Authorities allege the students pulled off a convoluted scheme in order to wring Apple of the cash by using counterfeit devices and exploiting Apple’s return policy.

Beginning in 2017, the two men allegedly smuggled thousands of counterfeit iPhones into the US from China and then sent them in for Apple to repair or replace, claiming the knockoffs wouldn’t power on. In many cases, Apple did replace the counterfeit goods with real iPhones, which cost the company an estimated $895,800.

(Source).

Cult of Mac reports that fake iPhones are now extremely sophisticated, with quality good enough to fool even a relatively discerning buyer.

neoboy · 7 Apr 2019 at 12:47

Not hard to do if they don't power on but looks like it took them a long time to open them up to figure out what was going on.

Not needing proof of purchase is what made it really easy, not sure if it's a US thing but always had to provide that in the past here with at least the IMEI on it?

xb8browney · 7 Apr 2019 at 12:58

Every time I've delt with apple, they always ask for proof of purchase and apple id.

Cromulent · 7 Apr 2019 at 14:10

neoboy said:
Not hard to do if they don't power on but looks like it took them a long time to open them up to figure out what was going on.

Not needing proof of purchase is what made it really easy, not sure if it's a US thing but always had to provide that in the past here with at least the IMEI on it?

If you can fake an iPhone you can easily fake proof of purchase.

neoboy · 7 Apr 2019 at 14:17

Cromulent said:
If you can fake an iPhone you can easily fake proof of purchase.

Surely they would check the IMEI on it though?

Alpherah · 7 Apr 2019 at 15:53

If only I could tell you guys half of the facts around this story.
They were doing this in pretty much every major apple region and becoming more and more elaborate and sophisticated.
Eventually everything they brought in got sent to a depot for analysis but this plan failed worse then letting the retail staff deal with it ‍

koooowweeee · 7 Apr 2019 at 17:46

neoboy said:
Surely they would check the IMEI on it though?

Can't that be changed? I know it could a few years back on androAn devices

chaparral · 8 Apr 2019 at 19:20

And how much did apple really lose ?

Just because apple sells an iPhone for around £800 don't mean it costs apple £800 to make it..

I bet that $895,800 was more like $195,000

Cromulent · 8 Apr 2019 at 20:55

chaparral said:
And how much did apple really lose ?

Just because apple sells an iPhone for around £800 don't mean it costs apple £800 to make it..

I bet that $895,800 was more like $195,000

The cost of an iPhone is not just materials. You have to factor in research and development, marketing, staff costs, rent etc etc.

neoboy · 8 Apr 2019 at 21:06

As well as customer service that gives out new phones without proof of purchase

Cromulent · 8 Apr 2019 at 23:10

neoboy said:
As well as customer service that gives out new phones without proof of purchase

That as well

.

pioneer2000 · 9 Apr 2019 at 08:00

They won’t even give out replacements for genuine problems nowadays, which is particularly galling when I’ve had my X repaired 3 times and my watch repaired twice.

Double07 · 9 Apr 2019 at 16:22

Well that doesn't really make up for the untold billions that Apple have scammed the general public out of in the last couple of decades.

Hades · 10 Apr 2019 at 13:38

Probably still more reliable than the iphones my wife and kids have repeatedly had problems with over the years.