US court awards 20 yrs jail term to 2 guilty in $3 mn iPhone repair scheme

San Francisco, Feb 21 (IANS) A U.S. court has found two Chinese nationals guilty of a "sophisticated scheme to defraud Apple out of millions of dollars’ worth of iPhones."

The scam involved submitting counterfeit iPhones to Apple for repair, which were then replaced with genuine iPhones.

Haotian Sun, 33, and Pengfei Xue, 33, were found guilty by a federal jury in the US District Court of conspiracy to commit mail fraud, which carry a statutory maximum sentence of 20 years in prison. The judge scheduled sentencing for June 21, 2024.

Both Chinese nationals received shipments of counterfeit iPhones from Hong Kong between May 2017 and September 2019, returning them to Apple retail shops and Apple Authorised Service Providers with falsified serial numbers and/or IMEI numbers.

Over the course of two years, more than 5,000 iPhones were submitted to Apple.

"Trial evidence showed that conspirators submitted more than 5,000 inauthentic phones to Apple during the conspiracy, intending to cause a loss of more than $3 million to Apple," the US Attorney’s Office noted.

Sun and Xue used various aliases during the scheme. They were arrested on December 5, 2019.