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Oregon students returned thousands of fake iPhones, costing Apple $900k
- aw3c2 8y ago*Two students. Current title makes it sound like there was a widespread phenomenum.
- redleggedfrog 8y agoAlso, they're Chinese, not Oregonians. "Two OSU students..." would be fine. Yes, I'm from Oregon.
- pugworthy 8y agoYes, that's how I'd write it, but I live in Corvallis so...
- cgy1 8y agoFunny enough the article has the two of them attending schools in Corvallis other than Oregon State.
- jarcane 8y agoOSU is in Corvallis.
- taborj 8y agoRight, but the article states that the students went to other schools, not Oregon State University.
- jsgo 8y agoAppears maybe the article typoed as they reference one going to Oregon Sciences University. I don't see anything named that when searching: there's OHSU, but it appears to be based out of Portland with a partnership with OSU for the Pharmacy program.
- kgwxd 8y agoWhatever school they happened to attend isn't germane either. "Two Dicks..." would be accurate.
- pugworthy 8y agoIt is, at least as far as the level of school. From the title it could be a pack of 20 clever 8 year olds.
- jldugger 8y agoBut one is from LBCC!
- geephroh 8y agoGo Roadrunners!
- cududa 8y agoNobody is crapping on Oregon as a state dude, it’s just a pertinent piece of the story, similar to “Florida Man”
- gowld 8y agoIt's not pertinent, so much as it's a quirk of English grammar/pragmatics
- redleggedfrog 8y agoWe're sensitive about these things. It's difficult living in the shadow of California.
- drb91 8y ago> It's difficult living in the shadow of California. It's gotta be harder to live with a white supremacist reputation. Not saying I care, but it's really funny to see someone from oregon get sensitive about this of all things.
- redleggedfrog 8y agoMy missive didn't convey the tongue in my cheek.
- deleted 8y ago[deleted]
- jak92 8y ago> Apple records showed Jiang was associated (by name, email, address or computer) to 3,069 iPhone warranty claims Geeze, you'd think Apple would have some sort of internal controls?
- president 8y agoPossible he had an insider who could tell him that there weren't any protections in place?
- penagwin 8y agoThis is one of those things were you'd think they'd automatically flag warranty claims for manual review after... what a few? I mean how many individuals (non-business) ever make more then say 5 warranty claims in their lifetime (with one company)?
- themagician 8y agoIn the last 10 years I've had at least a dozen warranty claims with Apple, maybe more. Usually just one claim per machine, sometimes two. And iPhones… I can't even keep track of that. You get two replacements with AppleCare+ and I almost always use them both. I've probably gotten a dozen replacements on broken iPhones alone. Not exactly 3,000+, but way more than 5. That's also not exactly abnormal. When you see people with cracked screens and ask them why they don't get them fixed the answer is usually, "I already used my replacements." I would think that, among lifetime Apple customers who purchase AppleCare the average is actually above 5.
- rootusrootus 8y agoThere is a pretty big difference between 1-2 a year and thousands. Seems like it would be trivial to use an algorithm to flag the users that are, say, two or more standard deviations from normal, and pay a little more attention to their circumstances.
- penagwin 8y ago
- deleted 8y ago[deleted]
- jonfriese33 8y agoDid they just copy the article exactly and then put "- The Olympian" at the end of the title. Horrible. Original source: https://www.theolympian.com/news/nation-world/national/article228763654.html https://www.theolympian.com/news/nation-world/national/artic...
- true_religion 8y agoYes. That's how syndication works. You pay for content, then tell your end-users where you got it from.
- ada1981 8y ago🆒
- fuckEmojis 8y agoew.
- acct1771 8y agoNo, seriously, ew. I reject 100% hieroglyphic communication.
- smogcutter 8y agoMany moons ago I worked at an apple store genius bar, and this was constant. There wasn't a whole lot we could do about it unless the phones were obvious fakes. Those we would reject, as well as ones where the serial number came up as having been replaced a number of times. Guys would bring in a bunch of phones at a time. They knew the apple store drill and would make a separate appointment for each phone. It sucked, and took time and resources away from real customers. But we couldn't broom them without a concrete reason so they usually got at least a couple phones replaced. We mostly assumed the phones were stolen and were being washed for new serial numbers, but it makes perfect sense that there are big counterfeiting operations behind this.
- Scoundreller 8y agoI think I just realized what kind of people I sold my authentic MacBook Air case bottoms to. And case from a broken iPhone. Edit: side note: it took a while to sell for not a lot of money. But other than someone needing to drill out a screw and caring about how it looked afterwards, i couldnt figure out why anyone would buy.
- ska 8y agoi couldnt figure out why anyone would buy. curious then, why were you attempting to sell?
- Scoundreller 8y agoIts battery died. With a student discount and the cost of a new battery, I could (and did) upgrade to a new model by selling all the parts. Even the screws. Some say the MacBook Air is highly integrated and unrepairable. They are wrong.
- ghusbands 8y agoBecause it has value? If you have something that you don't want and someone else wants to buy it (and there's no obvious fraud involved), it's a trivial decision.
- Miner49er 8y agoIsn't it possible they didn't know the phones were fake? If the fakes are so good that even Apple can't tell, then it's possible they thought they were real. Maybe they thought they were buying genuine iPhones for cheap since they were broke and having Apple send replacements to make a profit? Or am I missing something?
- lavezzi 8y agoIt doesn't sound like it the way the article frames it. A lot of shipments were stopped at the border by CBP.
- Scoundreller 8y agoStopped because of how they were packaged. But if you were shipping goods to your friend to return for you, why would you send them in retail boxes? They’re already “broken”. No need to overprotect anything. As an Ebayer, most of my shipments are in crumpled re-used Amazon packaging with 50 stamps. At least I type out the “TO” address.
- taborj 8y agoYeah, but the frequency is the thing. They returned several thousand, which - if legit - means these two were the point of contact for an entire village back in China. I can buy that the guy sending them back may not have known, though again the quantity he was sending should have raised a red flag. But the guy who was receiving the broken counterfeits and returning them to Apple? No way he didn't know he was doing something shady.
- rasz 8y agoThere were no counterfeits, apple calls original iphone/parts fake when its being shipped internationally without their authorization. https://motherboard.vice.com/en_us/article/a3yadk/apple-sued-an-independent-iphone-repair-shop-owner-and-lost https://motherboard.vice.com/en_us/article/a3yadk/apple-sued...
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- dman 8y agoDont phones have serial numbers which are attached to apple ids? Why could apple not implement some reporting based on device serial number or apple id?
- Scoundreller 8y agoIt’s probably not that hard to get ahold of clean serial numbers that haven’t gone through the return process. Then just etch them. As for Apple ID... It’s not hard to create them. I think any credit card requirements are recent, and definitely not planet wide.
- jsgo 8y agoIt's probably a public perception thing: from my experience and a lot of other anecdotes, they're incredibly accommodating with the service and replacement programs. The Verge or Engadget would have a near annual article about "iPhone [2-3 generations ago] still under AppleCare being replaced with iPhone [more recent generation]." Yeah, losing out to counterfeiting stinks, but I think they prefer the perception of being customer service centered. Probably worth more to them than the losses it generates.
- gowld 8y agoThey have to do that to balance out the bad press of "you're holding it wrong" when there's a mass design defect.
- rootusrootus 8y agoOkay, I'm probably over-sensitive since I am an Oregonian, but 1) it was just two students, and 2) they were Chinese nationals.
- cududa 8y agoIt has nothing to do with Oregon
- unquietcode 8y agoSure, but just for reference... This: $900,000 AAPL: $922,780,000,000 I think they'll be OK.
- lowlevel 8y agoApple was losing billions in China. While this is just some of the phones trickling into other markets for replacement, it's still fraud and hurting Apple. This is why recently they've started to say iPhone exchanges had to be sent to depot rather than just replaced on the spot.
- pojntfx 8y agoThe fact that we choose to blame broke students instead of the multinational corporation that uses child labor for almost everything is kinda telling.
- rdtsc 8y ago> The fact that we choose to blame broke students instead of the multinational corporation that uses child labor for almost everything is kinda telling Broke students, who, seemingly managed to buy 3000+ Apple phones and return them? That's some terrible luck they had :-)
- closetohome 8y agoAnd I've never met a poor Chinese (national) student. If they can afford to go to school in the US, their family is generally doing alright.
- artificial 8y agoIt's amazing we do any business with China (or any country not a strong proponent of western values) and in this case it's Foxconn. The makers of: BlackBerry, iPad, iPhone, iPod, Kindle, Nintendo 3DS, Nokia devices, Xiaomi devices, PlayStation 3, PlayStation 4, Wii U, Xbox 360, Xbox One, and the TR4 CPU socket on some motherboards. Just curious if you actively shun anyone who uses these products?
- tamizhar 8y ago> It's amazing we do any business with China (or any country not a strong proponent of western values western values? that's an interesting term, care to elaborate?
- TomVDB 8y agoIt is wrong to blame 2 individuals who returned 3000 fake phone in what it's an illegal scam plain and simple? What's the alternative? Praise them as modern day Robin Hoods?
- 8y ago
- altmind 8y agoCan somebody explain what is 'Wire fraud' and if this charge can be applied to almost any activity done with electronic device?
- Bluestrike2 8y agoThe elements of wire fraud, per the DOJ criminal resource manual: > The elements of wire fraud under Section 1343 directly parallel those of the mail fraud statute, but require the use of an interstate telephone call or electronic communication made in furtherance of the scheme. United States v. Briscoe, 65 F.3d 576, 583 (7th Cir. 1995) (citing United States v. Ames Sintering Co., 927 F.2d 232, 234 (6th Cir. 1990) (per curiam)); United States v. Frey, 42 F.3d 795, 797 (3d Cir. 1994) (wire fraud is identical to mail fraud statute except that it speaks of communications transmitted by wire); see also, e.g., United States v. Profit, 49 F.3d 404, 406 n. 1 (8th Cir.) (the four essential elements of the crime of wire fraud are: (1) that the defendant voluntarily and intentionally devised or participated in a scheme to defraud another out of money; (2) that the defendant did so with the intent to defraud; (3) that it was reasonably foreseeable that interstate wire communications would be used; and (4) that interstate wire communications were in fact used) (citing Manual of Model Criminal Jury Instructions for the District Courts of the Eighth Circuit 6.18.1341 (West 1994)), cert. denied, 115 S.Ct. 2289 (1995); United States v. Hanson, 41 F.3d 580, 583 (10th Cir. 1994) (two elements comprise the crime of wire fraud: (1) a scheme or artifice to defraud; and (2) use of interstate wire communication to facilitate that scheme); United States v. Faulkner, 17 F.3d 745, 771 (5th Cir. 1994) (essential elements of wire fraud are: (1) a scheme to defraud and (2) the use of, or causing the use of, interstate wire communications to execute the scheme), cert. denied, 115 S.Ct. 193 (1995); United States v. Cassiere, 4 F.3d 1006 (1st Cir. 1993) (to prove wire fraud government must show (1) scheme to defraud by means of false pretenses, (2) defendant's knowing and willful participation in scheme with intent to defraud, and (3) use of interstate wire communications in furtherance of scheme); United States v. Maxwell, 920 F.2d 1028, 1035 (D.C. Cir. 1990) ("Wire fraud requires proof of (1) a scheme to defraud; and (2) the use of an interstate wire communication to further the scheme."). It's a fairly broad statute, but to answer your question, it depends on whether the "activity" in question meets all of the elements of wire fraud. https://www.justice.gov/jm/criminal-resource-manual-941-18-usc-1343-elements-wire-fraud https://www.justice.gov/jm/criminal-resource-manual-941-18-u... https://www.justia.com/criminal/offenses/white-collar-crimes/fraud/wire-fraud/ https://www.justia.com/criminal/offenses/white-collar-crimes...
- cwkoss 8y agoWere all/any of the phones Jiang returned actually counterfeit? Nothing in the article seems to definitively identify them as counterfeit. If their determination is truly based on: > "but which appeared to be counterfeit based on shipping methods and packaging" Seems like Jiang has a pretty solid defense. Maybe all the phones were real iPhones, but were owned by people who can't/won't do a return through apple themselves.
- _cerv 8y agoApple warranty fraud is a great way to make money. I know of a guy who between 2008 and 2010 would purchase used iPod lots from Costco Electronic Hardware Services, refurbish the water damage indicator in the headphone jack and dock, and then try to return the iPod to one of the few Apple stores in the Seattle area. The refurbishing method would consist of cutting tiny strips of white wax paper, applying a little adhesive, and then sliding the paper flush down the hole. When Apple caught onto this guys method, he would later take the whole headphone assembly apart by using a pen knife to lift the plastic around the headphones, pulling the jack out, and using whiteout to cover the other end. I went to the Apple store with this guy and felt ashamed just being around him as he dropped off a dozen water damaged iPod Nanos, each with an appointment, telling the guy that they were from guys in Iraq, as if that were to add some emotional weight to getting new ones. Nearly a decade later I found out the guy was running the same scam with the iPhone SE by using reassembled water damaged phones or dummy phones from China. I am guessing he didn't get caught because the scale of his operation were a few at a time, maybe a couple hundred in a year, but not thousands over a year. Now that I think about it, I had let him use my Apple account for appointments and claims, and ever since then, I have always had a bad time working with the genius bar over things that I bring in.
- akhilcacharya 8y agoWhat's an "iPod lot"? I've never heard this terminology before.
- _cerv 8y agoCostco would sell a couple dozen to several hundred iPod Classics, Nanos, and Touches, all in varied condition, as a "lot". At best you could buy these based off of a grade, which just judged their physical condition, but most of the time you were always buying these a couple dozen at a time, sight unseen.
- akhilcacharya 8y agoOh my, I didn't know this was available. Who usually buys these? Third-party refurbishers?
- lamarpye 8y agoSeems like a solid business plan; better than Lyft or Uber.
- wuxb 8y agoBlaming China--Is it a norm now? whatever the problem is, please blame China, Trump, and maybe some alien civilization?
- nolawi89 8y agowow thousands- if he was just to do like 12 a year he would have stayed under and have some income.. i guess even if he gets half.. its a few thousand a year
- IronWolve 8y agoReminds me of a scammer at work in the 90s (attws). She was ordering base stations 2 at a time, deploy 1, sell one. She made a couple million but kept going until someone noticed she should have a stock of base stations.
- reasonablemann 8y agoChump change compared to what was going on in China: https://appleinsider.com/articles/18/10/09/rampant-chinese-iphone-repair-fraud-forced-apple-to-develop-countermeasures https://appleinsider.com/articles/18/10/09/rampant-chinese-i...
- dgzl 8y ago> Zhou and Jiang were living in Corvallis, Oregon, on student visas to study engineering — Zhou at Oregon Sciences University, Jiang at Linn Benton Community College, court documents said. Not sure if it's been posted yet, but I'm 99% sure this is a typo. Oregon State University is what they meant.
- okko12 8y agoDo you still remember the iPhone Slow Down Scandal? How much does it cost customer?
- cosmas 8y agoApple fraus