Former Oregon Students might have almost pulled off a bigger scam than the Frye Festival with less effort, which is leaving me with a few questions I’ll get to later, but check this out from nbcnews.com.
Jiang, who was reportedly a student at Oregon State University at the time, estimated that he submitted over 2,000 warranty claims in 2017 alone, the government said, and Apple’s records show over 3,000 claims in total attributed to Jiang. In every case, Jiang claimed that the iPhones could not be turned on, which turned out to be the crux of the scam, according to the government
Yes, these folks managed to not only file 2000 warranty claims to one of biggest tech companies in the world and no one batted an eye initially handing over hundreds of thousands of dollars in product. Here’s a breakdown of the numbers.
While Apple was able to determine that many of the counterfeit iPhones Jiang submitted were not authentic, the company still accepted 1,493 of the phones the student sent in as authentic and provided him with replacement iPhones. At a cost of $600 per iPhone, according to the company’s estimates, those replacements resulted in losses of $895,800 for the tech giant, the government said
My question is which former employee or employees(I assume they were fired) received over 1000 messed up iPhones and didn’t take a second to think that possibly something fishy was taking place or maybe a bad batch hit the market which should have immediately flagged something. This scam was multi-level as it seems the students were middlemen to a bigger scheme.
Jiang told authorities that he regularly received packages with 20 to 30 iPhones from “an associate” in China with instructions to submit them to Apple under warranty claims. After receiving replacement iPhones, Jiang would ship them back to China, where they could be sold. The unnamed “associate” would pay a portion of the profits to Jiang’s mother in China, who would deposit the funds into a bank account that Jiang could access from the US.
Last year, federal agents searched Jiang’s Oregon home and found over 300 counterfeit iPhones, along with shipping records and documents for warranty claim submissions. They also found several boxes that had been addressed to Zhou, who has been named as Jiang’s accomplice.
“With respect to Mr. Zhou, the government has the case completely wrong,” Jamie Kilberg, an attorney for Zhou, wrote in an emailed statement to CNBC. “Mr. Zhou had no knowledge of any alleged counterfeiting scheme, and when the actual facts come out, we are confident he will be vindicated.”
Zhou who was studying engineering at Linn Benton Community College could soon be studying the inside of a prison is facing charges submitting false or misleading information on an export declaration, which could lead to a fine of up to $10,000 and five years in prison. Jiang is being accused of wire fraud and trafficking in counterfeit goods. He faces up to a $2 million dollar fine and 10 years for trafficking and an additional 20 years in prison for wire fraud.
Moral of the story kids, if you need to make a little money on the side maybe try Uber, dog walking or cutting lawns like in the old days. As they say “All Money Ain’t Good Money”. Follow me on the Twitter @SBReports706 and let me know what you think.