A US court has ordered a Chinese citizen to pay Apple $1 million for submitting thousands of fake iPhones to trick the company into shipping him real replacement models.

On Thursday, a judge also sentenced 34-year-old Haotian Sun to four years and nine months of prison time for the scheme, which involved more than 6,000 counterfeit iPhones.

Sun, a resident of Baltimore, Maryland, initiated the scheme in 2017 when he began receiving fake iPhones sent from Hong Kong. He then submitted the counterfeit devices to Apple, claiming the phones had been damaged or were malfunctioning, and needed to be replaced to honor the product warranty.

To pull off the scam, the fake devices used out-of-warranty iPhone models that contained counterfeit parts inside. Sun would also use duplicate serial numbers and IMEI numbers from real iPhones still under warranty. “Thus, when Apple employees conducted a preliminary review of these returned phones, the spoofed numbers led Apple to believe that the devices were legitimate iPhones, which were under warranty, and thus, were eligible for replacement iPhones,” a US postal investigator wrote in 2019, describing the crime.

A court document suggests the scheme duped Apple and its authorized service providers into sending replacements for over 2,700 counterfeit iPhones. The scheme lasted until late 2019 when investigators arrested Sun. By then, Apple had suffered a loss of over $2.5 million.

In February, a federal grand jury finally convicted Sun and his accomplice, another Chinese national named Pengfei Xues. On Thursday, the US district court also sentenced Xue to more than four years in prison while ordering him to pay $397,800 in restitution to Apple. The judgment also requires Sun to forfeit $53,610 and Xue to give up $19,890.

By: DocMemory
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