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Five Chinese Nationals were arrested for Alleged $12.3 million Fraud of returned counterfeit Apple iPhones and other Devices


On Friday, five Chinese nationals were arraigned after their arrest on federal charges alleging that they operated a large-scale, trans-Pacific counterfeit scheme involving the fraudulent return of thousands of Apple iPhones, iPads, and other Apple goods causing the company to approximately lose $12.3 million.

A federal grand jury charged the following five defendants in a 22-count indictment unsealed Friday:

  • Yang Song, 40, of Corona, the alleged ringleader;
  • Junwei Jiang, 37, of East Los Angeles;
  • Zhengxuan Hu, 26, of Alhambra;
  • Yushan Lin, 30, of Corona; and
  • Shuyi Xing, 34, of Corona.


All of the defendants were charged with one count of conspiracy to commit wire fraud and mail fraud, one count of aggravated identity theft, seven counts of wire fraud, 12 counts of mail fraud, and one count of conspiracy to traffic in counterfeit goods.

“The defendants are being accused of taking advantage of Apple’s customer-service policies to steal more than $12 million in merchandise,” said United States Attorney Martin Estrada. “Companies should not be victimized and defrauded for being responsive to customer needs, and these federal charges send a message that our office will take decisive action to uncover and prosecute those who perpetrate fraud.”

“Protecting American ingenuity, ensuring economic security, and shielding the consumers across the nation is a top priority for Homeland Security Investigations,” said HSI Los Angeles Special Agent in Charge Eddy Wang. “Due to the outstanding work of HSI Los Angeles with our law enforcement and private sector partners targeting this large-scale fraud operation, we have prevented millions of dollars from lining the pockets of this transnational criminal organization.”

“The defendants allegedly sought to introduce more than 16,000 fraudulent devices into Apple’s product line with the purpose of exchanging them for genuine devices to be sold for profit,” said Special Agent in Charge Tyler Hatcher, IRS Criminal Investigation, Los Angeles Field Office. “CI follows the money, and our expertise helps us safeguard U.S. businesses when faced with fraud. We are committed to our partnerships with fellow law enforcement agencies like Homeland Security Investigations to protect our country’s commerce ecosystem by investigating those who seek to take advantage of businesses’ consumer protection programs.”

According to the indictment, from at least December 2015 to March 2024, Song and Jiang coordinated with co-conspirators in China to ship counterfeit Apple iPhones, iPads, and other devices to them and other U.S.-based co-conspirators. The counterfeit Apple devices shipped to Song, Jiang, and others in the U.S. were designed to look like genuine Apple devices and included identification numbers matching the numbers on real Apple products that had been sold in North America, were owned by real people, and were under warranty through Apple’s manufacturer warranty and AppleCare+, Apple’s extended warranty program.

The defendants allegedly then fraudulently returned the counterfeit iPhones, iPads, and other devices to Apple as if they were genuine and had been legitimately purchased, were eligible for Apple’s warranty programs, and as if they were the lawful possessor of the Apple devices. The real identification numbers and serial numbers on the counterfeit devices that defendants allegedly retuned were designed to essentially impersonate the real Apple devices owned by real people throughout the United States, which defrauded Apple’s warranty programs and potentially deprived the Apple devices’ lawful owners of the warranty benefits to which they were entitled.

As part of the scheme, the defendants allegedly took multiple steps to disguise their identities and hide their fraud over the years. For example, they allegedly rented dozens of mailboxes at UPS stores across Southern California for use in the scheme, including to receive counterfeit devices from China and receive genuine replacement devices from Apple. They allegedly also misspelled the mailing addresses they provided to Apple and added or removed extra characters to the mailing addresses, to disguise the fact that they were processing numerous fraudulent returns of Apple devices. Other times, they allegedly used aliases to make appointments at Apple stores to process their fraudulent returns of devices.

After successfully returning the counterfeit Apple devices for genuine ones, the defendants allegedly shipped the genuine devices to co-conspirators both in the United States and abroad, primarily in China, where the genuine Apple devices were resold at a substantial profit.

In total, the defendants fraudulently returned and attempted to return more than 16,000 counterfeit Apple devices, causing Apple at least $12.3 million in losses.

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