Man who unlocked nearly 2M AT&T phones gets 12 years in prison | Hacker News Reader

Man who unlocked nearly 2M AT&T phones gets 12 years in prison

theverge.com

36 pointsjonpurdy25 comments

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When I read the headline, I thought it was dumb. Then I read the article.

He bribing ATT employees to make this happen. That crosses a line.

I don’t know if 12 years is appropriate, but paying off a network of employees crosses a line.

The “pay to unlock it” system is bad. But this guy was simply undercutting ATT (by means of corrupt employees).

Not bribing to unlock, bribing to install malware on an AT&T machine. That ain’t good.

I'm curious how they determine it cost ATT 200M in revenue. If your business model relies on people who own their own device being stuck with you, perhaps it's time to look in the mirror.

I guess AT&T makes about $106 USD for every locked phone they sell?

$201,497,430.94 (USD) / 1,900,033 (phones) = $106.049 (USD per phone)

I used the numbers from this link:

https://www.justice.gov/opa/pr/fraudster-sentenced-prison-lo...

Isn't it pretty common to subsidize the cost of phones by requiring a certain length of service? What business model would you propose?

That's called a contract. You still have to pay money to end your contract early.

Carriers, to my knowledge, do not sell phones at a loss without a contract in place.

from the doj press release:

> AT&T has further determined that the loss it suffered because customers, whose cellular phones were illegally unlocked, failed to complete payments for their cellular telephones was $201,497,430.94.

There's really no effective way to collect amounts of money not worth suing over when someone stops paying on a contract like this.

Thanks. This actually answers my initial questions. So basically, deadbeats gaming the system :(.

Deadbeats and companies.

The latter fully control their lending standards, and can pull back on lending to poor credit risks.

Thing I am curious about is the employees he bribed. I haven't seen anywhere if they got prosecuted or anything. Seems like they were also just as complicit ?

I posted this and was wondering how this would affect AT&Ts business at all. If you’re carrier-locked or not, wouldn’t you still have a contract to pay and be on the hook for monthly fees? And if you don’t pay, be forwarded to collections?

(I’ve never had a carrier locked phone and never understood why people buy them.)

Yes, this is exactly right. If you owe money on a device, even if you unlock it, you still owe money. Same as if you're under contract with the carrier...you still have to fulfill it, or pay termination, regardless of phone status.

Then the whole locking thing doesn't really cause any revenue to the carrier... unless you do this to force people to use your carrier for X years and calculate revenue based on that.

In any case, at least here in Switzerland, carrier-locked phones aren't a thing anymore - I guess they realized it's just stupid and impractical.

ATT has the worst policy on locked phones too. Say you buy a iPhone from Apple that works with ATT. Even if you pay in full it’s still locked. You have to contact ATT to get it unlocked. Verizon just has your phone locked for 30 or 60 days then they just unlock it. Seems like ATT is hoping you just don’t go through the hassle of unlocking it. I mean personally now I just get my phone through Apple and not carrier locked.

> help him secretly unlock AT&T phones, freeing the customers from any installment agreement payments and from AT&T’s service.

How are phone service contracts written in the US? In Canada, if you want to cancel your service, you have to pay the remainder of the price of the phone that you got on contract. Phones have to be sold unlocked by law, but even before this regulation was passed, it was not like you could get a locked cellphone on a 2 year contract and then cancel the plan after one month and keep the phone for free.

Keeping the phone locked gives the carrier leverage over the customer. There will be some percentage who get their subsidized phone and quickly quit paying their monthly bill. Then they can move to another carrier if the phone is unlocked. The original carrier of course is still owed money under the contract but will find it expensive to collect. Locking the device is a tool to prevent this. What's dirty though is carriers not automatically unlocking the phone as soon as the contract ends. It's a way of making switching to another carrier difficult even if you've fulfilled your contract in full.

You have to pay remainder to cancel here, as well. But if you just stop paying your bill and keep the phone att isn't going to bother to come after you unless it was multiple thousands you owe them on multiple phones.

Can you legally unlock your own phone if you knew how to do it yourself?

No. For a while it had to be done from a server on the carrier's side.

It used to be that if you wanted your iphone unlocked (this may still be true) you had to beg your carrier to do it. THey would submit a ticket to their internal team, and within 48 hours your phone would get the go ahead to unlock itself. Even if you had bought the phone, or fulfilled your contract, the carriers in the US would frequently refuse to unlock. The workaround was to go to some sketchy guy in a strip mall, give them $50, then they would somehow get someone at the carrier to unlock the phone. I suspect this guy had something to do with it.

Carrier-locked phones are a real stupid idea that should have been legislated away a long time ago

Cellphones shouldn’t be that important, but they are. 12 years is light given that increasingly phones are identity. Imagine stealing 2 million people’s SSN information.

How do you compare unlocking a phone for someone who bough it to stealing one's personal information? They're not similar in any way.

It's the generic "Terrorism and rape will happen if you are allowed to control your own device that you actually paid money for" FUD.

And the rape part is not an exaggeration, it was actually used as an argument against the Right to Repair ( https://www.youtube.com/watch?v=EozPi1qmH44 ), wouldn't be suprised to hear it in this case too.

I agree. There isn’t an alternative with cellphones because of the importance they hold, legally, financially, politically. Power in your pocket; like a gun.

Everything is connected. You just view things from your own perspective, not from the perspective of the phone company or the banks etc…

I note you can scarcely even hope to explain the verdict. Your model doesn’t fit and so you have no ability to make sense of it.

From the article:

> It’s not clear from the DOJ release whether anyone besides AT&T was harmed as a result of the scheme; there’s no mention of customers’ phones being otherwise compromised or any personal data being accessed. We’ve reached out to the DOJ to clarify whether any AT&T customers were affected.

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