Sun. Oct 6th, 2024

Apple's losses due to counterfeit iPhones amounted to $2.5 million: the company could not recognize them

Apple's losses due to fake iPhones amounted to $2.5 million: the company could not recognize them

Two people in the United States were sentenced to prison terms for organizing a complex scheme, which defrauded Apple of approximately $2.5 million. They replaced the fake iPhones with real ones and asked for their returns.

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What else is known

Haotian Song was jailed for 57 months, while his accomplice, Pengfei Xue, was sentenced to 54 months . Both must pay substantial restitution to Apple: Sun more than $1 million and Xue almost $400,000, and serve three years of supervised release.

From 2017 to 2019, Sun and Xue, along with accomplices, used Apple's kickback system , spoofing the serial and IMEI numbers of legitimate iPhones that are still under warranty. This allowed them to ship thousands of counterfeit devices that Apple mistakenly thought were genuine and eligible for warranty replacement. Their operation was recognized as "systematic" and went unnoticed by Apple employees for years.

The scheme fell apart after someone at Apple did take notice.

Natasha Kumar

By Natasha Kumar

Natasha Kumar has been a reporter on the news desk since 2018. Before that she wrote about young adolescence and family dynamics for Styles and was the legal affairs correspondent for the Metro desk. Before joining The Times Hub, Natasha Kumar worked as a staff writer at the Village Voice and a freelancer for Newsday, The Wall Street Journal, GQ and Mirabella. To get in touch, contact me through my natasha@thetimeshub.in 1-800-268-7116

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