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Counterfeit operation responsible for 41k fake iPhones valued at $19M shut down in China
Beijing police have raided and shut down a factory responsible for producing in excess of 41,000 fake iPhones worth around 120 million yuan ($19.4 million) over a five-month period, reports Reuters.
Among the nine people arrested by police were a husband and wife who were the alleged ringleaders of the counterfeiting operation. The factory – which police raided on May 14 but only shared details on now – was operating under the guise of a gadget maintenance business. The authorities seized 1,400 fake iPhones as well as accessories during the raid.
It appears the couple at the head of the operation bought second-hand components as well as fake parts bearing the Apple logo from Shenzhen, in southeastern China, and had the pieces reassembled into fake iPhones by hundreds of workers manning six assembly lines.
The operation was uncovered after some of the fake iPhones surfaced in the U.S., where they were discovered by law enforcement. Beijing police investigated the matter following a tip-off from U.S. law enforcement.
China is widely known as a source of counterfeit goods. A 2013 report from the UN Office on Drugs and Crime revealed that from 2008 to 2010 China accounted for nearly 70 percent of all counterfeit goods seized worldwide.
Not surprisingly, this is not the first time Apple has fallen victim to China’s industrious counterfeiters. In 2011, 22 fake Apple stores were discovered in the Chinese city of Kunming. The stores were near identical copies of Apple’s own stores, including identical décor and employee uniforms. They were reproduced so well that even employees were under the impression that they were working for Apple.
It is also not the first time fake iPhones have been found on sale in the U.S. In 2013, Baltimore police uncovered numerous fake Apple products, including 24 fake iPhones, during a raid on two retail outlets in that city.
Apple products have found increasing popularity in China over recent years, making it a lucrative target for counterfeiters. Apple’s revenue from Greater China – comprised of mainland China, Hong King and Taiwan – jumped 112 percent during the June quarter of this year.
Apple CEO Tim Cook told The Wall Street Journal that he thinks China will one day be the company’s largest market.
Image credit: Kasman via Pixabay.com
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