US Man Jailed For Trafficking Fake iPhones That Cost Apple $6 Million

A man in the United States, who led an international ring that trafficked counterfeit Apple products, has been sentenced to 51 months (four years and three months) in prison. According to a release by Office of the United States Attorney Southern District of California, San Diego-based Zhiwei "Allen" Liao defrauded Apple out of $6.1 million by swapping real iPhones and iPads from China with fake ones in the US and Canada. Authorities seized two houses, $120,370 and more than 200 Apple devices from the 34-year-old.

The official release further said that Zhiwei Liao, along with his brothers Zhimin Liao and Zhiting Liao, imported counterfeit iPhones and iPads from China "that looked genuine and included identification numbers (IMEI and serial numbers) matching identification numbers on real iPhones and iPads that were under warranty and had been previously sold to customers in the United States and Canada".

"Zhiwei Liao then sent the fraudulently obtained, but genuine Apple products primarily to China where they were sold at a premium," the release further said.

According to court documents, the fraud scheme involved more than 10,000 counterfeit iPhones and iPads.

"At the direction of the Liao brothers, co-conspirators traveled to hundreds of Apple Stores across the United States and Canada, and attempted to exchange counterfeit iPhones and iPads for genuine iPhones and iPads," said the document.

The judge defended the "significant prison sentence" stating that Zhiwei Liao was the organizer and leader of an extensive international criminal organisation and trafficked counterfeit products for several years.

"Mr Liao's sentencing closes a major chapter in a multi-year investigation that exposed an international, elaborate scheme to sell counterfeit goods worldwide," said FBI San Diego Special Agent in Charge Stacey Moy. "This investigation would not have been successful without the unwavering dedication and persistence of our law enforcement partners. We remain diligent in the pursuit of justice to help maintain the integrity of our economy."

According to San Diego Union Tribune, FBI agents first investigated Zhiwei Liao and his family in 2019.