Two brothers from San Diego who ran a scheme to traffic fraudulently obtained iPhones and iPads were sentenced to federal prison terms this week.
Zhimin and Zhiting Liao each received 41-month sentences Monday for importing iPhones and iPads from China and exchanging the fake items at Apple stores across the United States and Canada.
Prosecutors wrote in sentencing documents that Zhimin Liao personally visited 105 Apple stores in 22 states and tried to exchange around 720 counterfeit iPhones and iPads. Zhiting Liao personally went to at least 200 Apple stores in 18 states and Canada and tried to exchange around 718 counterfeit iPhones and iPads, according to prosecutors.
The men were indicted in 2019 along with a third brother, Zhiwei Liao, who is slated to be sentenced later this month.
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Prosecutors also charged the Liao brothers' wives for various roles in the scheme. Each of the women has also pleaded guilty and been sentenced to three years of probation. Eight other co-conspirators have also pleaded guilty.
Prosecutors say the defendants attempted to exchange more than 10,000 of the counterfeit products at stores during the scheme, which operated for around eight years.
The genuine products they received in return were then exported to people in foreign countries, resulting in a total loss of around $6.1 million to Apple.
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As part of their plea agreements, the brothers agreed to forfeit their interests in five San Diego residences, more than $250,000 in proceeds from the crime and more than 200 Apple iPhones linked to the conspiracy, according to the U.S. Attorney's Office.
