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Six charged with multiple felonies in fraud ring that stole more than $19 million in iPhones

By Cal Jeffrey · 5 replies
Jun 5, 2019
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  1. According to a complaint filed by federal prosecutors in April and recently unsealed, the defendants are faced with several felony counts including mail fraud, conspiracy, and aggravated identity theft.

    A Quartz report notes that the ring was highly organized with a top-level crew running the operation, which a cooperating witness (CW-1) referred to as the “Top Dogs.” They were responsible for selling the ill-gotten phones. A middle tier would handle stealing people’s identities and creating fake IDs. The lower level, to which the CW-1 belonged, consisted of “runners and drivers” and would do all the footwork in obtaining the iPhones.

    Runners, like CW-1, would be given fake IDs and would be paired with a driver. They would then make trips to various carriers posing as the legitimate cell phone account holders looking to upgrade. The fraudulently obtained phones would then be shipped overnight back to the Bronx between trips every few days, along with the used IDs.

    Case 1:19-cr-00391-AT by on Scribd

    In December 2014, an employee of the unnamed shipping service being used noticed the unusual shipments. What was suspicious about them was that the deliveries were coming from several different states (34 in all) going to two New York shipping stores rather than to residential or business addresses.

    After contacting authorities, investigators opened 39 of the shipments. They discovered around 250 phones and numerous fake IDs, drivers licenses, and passports.

    Shortly after that, two members of the ring were arrested on unrelated charges. While searching their phones and computers, authorities found evidence linking them to the Bronx fraud ring. CW-1 was one of those and chose to roll on his buddies to lessen his sentence.

    The rest of the defendants have pleaded not guilty and have been released on $100,000 bail bonds pending trial.

    Permalink to story.

  2. TheBigT42

    TheBigT42 TS Maniac Posts: 311   +190

    Can't the stores Identify which phones where stolen and deactivate the phone?
    When the customer reports that they didn't purchase a new phone they know its stolen.
  3. stewi0001

    stewi0001 TS Evangelist Posts: 2,162   +1,581

    I wonder how this scheme got started...
  4. Duke9192

    Duke9192 TS Enthusiast Posts: 20   +26

    It seems the store employees would begin to recognize the same people coming in over and over. I mean, 19 million dollars worth of I phones is more than a few visits even if spread over a countless number different stores.
  5. Nobina

    Nobina TS Evangelist Posts: 1,893   +1,406

    What are you talking about? That's like the price of one iPhone these days.
    Hexic likes this.
  6. Uncle Al

    Uncle Al TS Evangelist Posts: 5,249   +3,666

    Apple needs to hire them away and reverse engineer their business and put them in charge of Apple Distribution ...... they will make that much back the first year!
  7. himindedlolife

    himindedlolife TS Rookie

    19 million dollars and assuming average phone price of $500 is 38,000 phones over 7 years is 5,429 phones a year spread over 34 states is 160 phones per year from each state so 1 phone in each state stolen every couple of days spread over 4+ carriers and untold number of retail outlets. Seems doable. I'd have to check but you might never even have to hit the same place twice or at least have plenty of time in between. They probably played it about as low key as possible.

    Gonna do some time though. Federal sentencing guidelines are, er, uncompromising. Especially for an operation like this. Add points for sophisticated means too. It's over for a while.
    Cal Jeffrey likes this.

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