Police arrest 7 suspected of selling phony iPhones

Baoshan district police have arrested seven suspects accused of selling knockoff iPhones in a countrywide telemarketing scam that peddled more than 300,000 yuan ($48,996) worth of phony products, local media reported Monday.

The suspects were among 18 people whom police found involved in the illegal enterprise following a raid on its office and warehouse, according to a report in the Shanghai Evening Post.

Police said at a press conference Monday that the scam was run by a man named Liu Yun, who owned a telecom equipment wholesale company, according to the report.

Liu started the company in April. It had three offices in Minhang and Fengxian districts, as well as a warehouse in Minhang district. The company had posted several job advertisements online seeking telemarketers to sell the phony products, which also included counterfeit Nokia mobile phones and L'Oreal brand cosmetics. At one of its offices, it had five employees devoted to selling knockoff phones.

Baoshan police began investigating the company after receiving a report from a woman surnamed Cao, who complained that a telemarketer posing as a telecom company employee tricked her into buying a phony iPhone. The telemarketer told Cao said she could get an iPhone by purchasing a prepaid phone plan for 1,600 yuan.

A Quanfeng Express courier delivered the phone to Cao, who paid the courier 1,600 yuan. However, Cao soon found out that the iPhone was a knockoff.

Police officers visited Quanfeng Express and found information about a suspicious client who had frequently hired the service to deliver mobile phones and cosmetics.

The express company would collect the payments from recipients and then transfer the money to the client's bank account. That client turned out to be Liu.

Police said the case remains under investigation.