$1M iPhone Fraud Scheme Leads To Sentence For Alexandria Man

ALEXANDRIA, VA — An Alexandria man was sentenced to 12 months and a day in prison for a scheme defrauding Apple out of over $1 million.

According to prosecutors in DC federal court, Teang Liu, 38, of Alexandria, "actively participated in" the fraud scheme from June 2016 to at least June 2018. Prosecutors say the co-conspirators got shipments of fake iPhones with spoofed IMEI numbers and serial numbers that were similar to real iPhones.

The group allegedly returned the fake iPhones to Apple, claiming they were real and in warranty to receive replacement iPhones. The real iPhones were shipped to the conspirators outside the U.S., including in Hong Kong, according to court documents.

Prosecutors say Liu's role in the scheme involved included opening dozens of commercial mail agency mailboxes using fake ID cards, returning fraudulent phones to Apple retail stores, and traveling to the Rocky Mountains and Florida to facilitate the scheme.

According to court documents, the co-conspirators admitted to defrauding Apple out of over $1 million and intended to seek more money.

Lui and co-conspirators Haiteng Wu and Jiahong Cai are citizens of China. Lui moved to the U.S. in 2011 and received a master's degree in finance from George Washington University in 2014. All three were arrested in December 2019.

Each defendant pleaded guilty to conspiracy to commit mail fraud. Liu pleaded guilty in February 2021, while Wu and Cai pleaded guilty in May 2020. Cai served five months at a D.C. jail and was removed from the U.S. Wu was sentenced on Feb. 1, 2021, to time served, or about 26 months.