Technology

What's Up With Apple: Gift Card Theft Nets $1.5 Million, Plentiful iPhone Chips, and More

Two men, one in Texas and the other in New York, stole digital gift cards valued at $50,000 from an Apple Inc. (NASDAQ: AAPL) retail store in Southlake, Texas, and redeemed them in Apple Stores in New York for thousands of dollars worth of electronic products. Between 2015 and 2017, the two men and their accomplices netted $1.5 million in stolen Apple gift cards from Apple Stores across the county.

According to a report at Business Insider, the two men have now pleaded guilty to wire fraud and are currently awaiting sentencing after a few years of legal wrangling. The two men and other accomplices repeated the thefts in other Apple stores around the country. One man would steal the hand-held devices known as an “Isaac” that store employees use to ring up sales from anywhere in the store. Once he had the Isaac, things got interesting: “He then sat outside the same stores — still connected to the store WiFi network — and used the robbed employee’s account to acquire thousands of dollars in digital gift cards.”

After pilfering the digital gift cards, he texted them to his accomplice who entered Apple Stores in other cities and purchased high-end Apple products with the stolen cards. They could then sell the stolen goods for cash.

The current chip shortage that has caused some automakers to slow production also has taken a toll on smartphone makers. New data from Counterpoint Research indicate that shortages of semiconductors have continued through the third quarter: “Components that were once fully stored in the warehouse are bottoming and new components are not coming as requested.”

Counterpoint now expects 2021 smartphone shipments to grow by 6% year over year to 1.4 billion units. The research firm had previously estimated shipment growth of 9% to 1.45 billion units. Some smartphone makers had received just 80% of their ordered volume in the second quarter and “the situation seems to be getting worse as we move through Q3 2021.”

Tom Kang, Research Director at Counterpoint Research commented:

[T]he semiconductor shortage seems to affect all brands in the ecosystems. Samsung, Oppo, Xiaomi have all been affected and we are lowering our forecasts. But Apple seems to be the most resilient and least affected by the AP [application processor] shortage situation.

Last year, Apple was forced by French regulations to ship its then-new iPhone 12 models with a free pair of EarPods in the box. In most other parts of the world, Apple stopped shipping the new iPhones with EarPods and chargers, citing its efforts to reduce electronic waste.

While Apple toes the government line in France and elsewhere (China and Russia, for example), it chooses to ignore the law in some countries. Earlier this week, Brazilian regulators said they plan to fine Apple again for its failure to include a charger with iPhone 13. Apparently, last year’s $1.9 million fine was not persuasive.