2 Corona residents plead guilty in $16M Apple warranty fraud scheme

Two Riverside County residents pleaded guilty to participating in a years-long scheme that used counterfeit Apple products to defraud the company of more than $16 million, the U.S. Department of Justice announced on Wednesday, Sept. 3.

Yushan Lin, 31, and Shuyi Xing, 35, both of Corona, were part of a group that smuggled fake iPhones, iPads and other devices from China and returned them at Apple stores across Southern California, federal prosecutors said. The counterfeits were made to look authentic, with serial numbers matching those of actual customers whose devices were covered under Apple warranties.

The returns took place at Apple stores in Beverly Hills, Sherman Oaks, Pasadena, Irvine, Costa Mesa, Newport Beach, Glendale and other cities, according to court documents. Conspirators claimed the items were defective, leading Apple employees to repair or replace them with genuine devices. Those real products were then shipped to contacts in the U.S. and China for resale.

The group relied on dozens of rented mailboxes to receive counterfeit shipments from overseas and to collect new Apple products, according to the DOJ. Lin and Xing alone tried to return at least 1,584 counterfeit devices, causing more than $1.1 million in losses, prosecutors said. Overall, the conspiracy involved more than 27,600 devices and cost Apple at least $16.2 million.

Four other defendants — ringleader Wenhui Huang, 40, of Chino Hills; Yang Song, 38, of Corona; Junwei Jiang, 38, of East Los Angeles; and Zhengxuan Hu, 27, of Alhambra — have also pleaded guilty and are awaiting sentencing.

Lin admitted to conspiracy to commit wire and mail fraud. Xing pleaded guilty to the same charge, along with conspiracy to commit money laundering tied to more than $1 million from unrelated elder fraud schemes. Sentencing is set for Dec. 10, when Lin faces up to 20 years in federal prison and Xing faces as much as 40 years.