China has begun cracking down on counterfeit iPhone manufacturers. Shanghai authorities have arrested five individuals for developing and selling fake versions of Apple's popular smartphone. The detained parties were reportedly part of an organized criminal group that purchased components for the phones in Guandong in southern China and assembled them in Shanghai apartments.

Some of the parts were real iPhone components that were presumably smuggled out of Apple's factories, but that's raw speculation. Much of the phony hardware was similar to Apple's. The finished product functioned similarly to a legit iPhone, only with a shorter battery life. "It's really hard for customers to distinguish the fake ones from the genuine ones," an officer told the Shanghai Daily.

The fake iPhones are said cost about 4,000 Yuan (roughly $313) to produce and they're sold for about twice that amount – a few hundred Yuan less than Apple's product. There are plenty of other forged iPhones in circulation and we imagine the activities will continue when the fifth-generation device launches later this year.

Considering China's history of knock-offs, it's no surprise the country is a bedrock for bogus Apple gear. A few months back a blogger exposed replica Apple retail stores that had an elaborate attention to detail. Unassuming shoppers wouldn't realize they were in a fake outfit – especially if they've never been in a real Apple Store.

Although the operations were unauthorized, they supposedly sold genuine Apple products. Chinese officials eventually investigated the stores and they were required to remove Apple's trademarks. This included new store names, as the outfits changed their names from "Apple Store" to titles like "Smart Store" and "iParty."