Two Men Sentenced for Defrauding Apple

Two Chinese nationals, Haotian Sun and Pengfei Xue, were sentenced for a sophisticated fraud scheme that defrauded Apple of approximately $2.5 million by returning counterfeit iPhones disguised with genuine serial numbers between 2017 and 2019. Over this period, the duo shipped 6,000 fake devices from Hong Kong to Apple stores, convincing employees to replace them with real iPhones under the guise of warranty claims. Sun received a 57-month prison sentence and was ordered to pay over $1 million in restitution, while Xue was sentenced to 54 months and must pay nearly $400,000. Their operation was exposed after Apple tipped off federal authorities, leading to an investigation that included tracing intercepted packages. The men used multiple aliases and fake identities to evade detection, successfully exploiting Apple's warranty system until their arrest. The Justice Department characterized their actions as a 'sophisticated scheme', highlighting the challenges Apple faces in preventing such fraud.