Foxconn insiders involved in case of using defective parts to assemble iPhones for sale

      Sina Digital News reported on the morning of December 19 that Apple is investigating an alleged large-scale fraud case by some Foxconn managers who used substandard iPhone parts to assemble iPhones for sale. The amount involved in the case reached an incredible NT$1.3 billion (about US$43 million) over a three-year period.

　　Electronics manufacturer Foxconn said on Wednesday, December 18, that it had launched an investigation into an employee's alleged fraudulent sale of iPhones with defective parts. It is alleged that a Taiwanese businessman had worked with managers at Foxconn's Zhengzhou factory to obtain defective iPhone parts, assemble them, and then sell them under the guise of "iPhone products produced in China".

　　Normally, defective parts are destroyed as a matter of course. The businessman and his gang profited handsomely from these illegal transactions, allegedly making NT$1.3 billion (US$43 million) over the past three years.

　　The scheme is that the management team responsible for destroying the defective parts arranged to sell them to a group involved in the case, which assembled the parts into iPhones and sold them to unsuspecting buyers. A local report shows that the fraud was discovered and reported to Apple, which has also launched a formal investigation.

　　An email shows that the investigation is being led by Apple's Business Assurance and Audit (BA&A) team, which reports directly to the company's board of directors. A whistleblower appears to have emailed Cook to report the fraud. Foxconn has not yet commented on this, but former chairman Terry Gou is said to have privately said that it is not surprising that "unreasonable incidents" involving a small number of employees occur in a company with more than 1 million employees.

　　The iPhone has been the center of many fraud cases due to its high price. Previously, a criminal gang was suspected of using fake iPhones to exchange for genuine products at Apple customer service , causing Apple to lose more than $6 million.