Man pleads guilty to trafficking counterfeit iPhones in Oregon return scam

A Chinese student pleaded guilty in Oregon on Wednesday to one count of trafficking counterfeit iPhones, which he used to dupe Apple into giving him real units for sale in China.

Between January 2016 and February 2018, Quan Jiang regularly received packages containing as many as 20 to 30 inoperable, counterfeit iPhones from partners in Hong Kong, said the U.S. Attorney's Office for the District of Oregon. Jiang then used fake names to submit iPhones for warranty replacement, whether online or at one of the state's three Apple stores.

Jiang didn't receive his payouts directly. Instead, an associate paid his mother — also living in China — who would then transfer the money to Jiang's bank account.

Ultimately Jiang imported over 2,000 counterfeit devices, which he used to secure about 1,500 authentic iPhones, each valued at around $600 in Chinese resale.

A sentencing hearing is scheduled for Aug. 28. A maximum penalty could include 10 years in prison, three years of supervised release, and a fine of $2,000,000 or twice illegal proceeds, whichever might be higher. Jiang has already agreed to pay Apple $200,000, which could reduce his sentence.

It's not yet clear what will happen to fellow student Yanyyang Zhou, who was arrested alongside Jiang in April. At the time, Apple estimated the impact of the fraud at $895,800.

22 Comments

sflocal 6135 comments · 16 Years

About 5 years ago

AppleInsider said:
A sentencing hearing is scheduled for Aug. 28. A maximum penalty could include 10 years in prison, three years of supervised release, and a fine of $2,000,000 or twice illegal proceeds, whichever might be higher. Jiang has already agreed to pay Apple $200,000, which could reduce his sentence.

It's not yet clear what will happen to fellow student Yanyyang Zhou, who was arrested alongside Jiang in April. At the time, Apple estimated the impact of the fraud at $895,800.

I wonder why Apple is accepting $200K when it estimates the fraud at almost $900K? This degenerate should see serious time in jail. There was an article not too long ago about Apple's problem dealing with fraud in Asia, particularly China to the point of it making it so expensive that the amount was more than a rounding error on Apple's Asian financials.

What a POS this guy is. Since he's a Chinese national, I hope they deport his useless backside back to China.

chasm 3595 comments · 10 Years

About 5 years ago

sflocal said:
I wonder why Apple is accepting $200K when it estimates the fraud at almost $900K?
As you yourself quoted FTA, there's another accomplice we don't know the legal status of. Presumably Apple will be getting more money from that person.

Quan Jiang has pretty much thrown away his chance to live in any other country than China thanks to this fraud conviction, so that and having to surrender what is presumably his profit from the scheme is pretty severe punishment. The other fellow is likely to have it even worse.

laytech 342 comments · 15 Years

About 5 years ago

What half these selfish thieves don't care about, whether its fraud of Apple products, fraud of car insurance, house insurance, shoplifting or otherwise, is that it drives up the cost of everything for everyone. Businesses factor theft, fraud and other associated costs into their product or service, so all this does is drive up the cost of all products. Imagine if theft and fraud did not exist and how much less goods would potentially cost...

tokyojimu 531 comments · 17 Years

About 5 years ago

sflocal said:

I hope they deport his useless backside back to China.

Where he’ll be hailed as a hero and given a free apartment.

hentaiboy 1252 comments · 14 Years

About 5 years ago

So just to be clear, when perp handed over a 'broken' phone for warranty, the repair staff weren't able to tell that it was counterfeit on the spot?

And he was able to repeat this 1,500 times? :/