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| 12 years in prison for unlocking smartphones |
The US District Court has sentenced the planners of a seven-year program to illegally unlock AT&T phones to 12 years in prison.
According to the Ministry of Justice, Mohamed Fahd, 35, continued his seven-year plan to defraud the company after learning that he had illegally unlocked nearly two million cell phones and opening an investigation.
At his sentencing hearing, Judge Robert Rasnick said he had committed horrific cybercrime over a long period of time, and AT&T had reportedly lost more than $200 million.
In 2012, Fahad used the pseudonym Frank Zhang to communicate with an AT&T employee via Facebook. The Justice Department said it bribed him to help unlock customers' phones in exchange for large sums of money.
Pakistani national Farhad also asked the employee to share the plan with his colleagues at Bothell's Washington call center.
Fahd instructed the concerned employees to set up fake business activities and fake bank accounts for these activities. It's about receiving payments and creating fake invoices for every deposit made into a fake company bank account to show that money was paid for real services.
The Justice Department said employees unlock their phones for unauthorized customers and pay Fahd. But in the spring of 2013, AT&T introduced a system that made it difficult for employees to activate the IMEI.
Fahd hired a software developer to create malware that could be installed on AT&T systems without permission to unlock phones more efficiently, in larger numbers, and remotely.
Unlocking smartphones leads to business losses
Fahad asked the employees who took bribes to install malware and customized hacking tools so that he could unlock their phones remotely from Pakistan.
The Ministry of Justice said that the employees provided Fahd with detailed information about the company's systems and ways to open them in order to complete the process. Fahd paid $428,500 in five years.
The malware allegedly obtained system information and credentials from other AT&T employees. The developers use this information to modify the malware.
According to AT&T, Fahd and his associates have unlocked more than 1.9 million cell phones through the program. The company said that unlocking prevented customers from paying on their devices, which led to losses.
Cell phones cost several hundred dollars. To reduce costs, AT&T has subsidized the purchase of cell phones or the sale of cell phones to customers in installments.
Unlocking the phone removes it from the AT&T network, eliminating the need for account holders to pay the company for services or phone purchase fees.
Fahd was arrested in Hong Kong in 2018 after being prosecuted in 2017. He was extradited to the United States. He admitted conspiracy to commit electronic fraud in September 2020.
Fahad faced five wire transfer fraud cases, five travel law violations, conspiracy to violate computer fraud and abuse laws, and four cases related to accessing and damaging protected computers.