A Michigan man has admitted to running a fraudulent online return scheme that cost Apple nearly $1 million in refunds.
Van-Seyla Mork, 25, pleaded guilty to charges of wire fraud and money laundering in a San Jose federal court Monday as part of a plea deal, according to a statement from the U.S. Attorney’s office for the Northern District of California.
Mork’s scam, known as an “empty-box scheme,” essentially worked like this: Mork would contact Apple Support on behalf of customers and claimed that an empty box had arrived on their doorsteps instead of an actual product. That’s despite the fact that the customers did actually receive their products, which were presumably purchased directly from Apple’s online store.
The 25-year-old, of Kalamazoo, Michigan, would then receive refunds for the ostensibly undelivered items, which he admitted to stashing in multiple bank accounts in an attempt to throw future investigators off of his trail.
According to the U.S. Attorney’s Office statement, Mork’s prosecution was the result of an FBI investigation, headed by Special Agent in Charge John F. Bennett. It isn’t clear how Mork received the refunds, as no co-conspirators were named by the FBI or the U.S. Attorney.
All in all, Mork admitted to defrauding $1 million in returns from the Cupertino tech giant. He was charged with one count of conspiracy to commit wire fraud, drive counts of wire fraud, and court counts of money laundering.
As part of the plea agreement, Mork pleaded guilty to one count each of wire fraud and money laundering. Each count carries a maximum penalty of 20 years in prison. Mork could also be fined $250,000 for the wire fraud and $500,000 for money laundering.
While customers actually receiving empty boxes is not unheard of, empty-box schemes have long been used to defraud online retailers, including Amazon, eBay, and others by taking advantage of their usually-generous refund policies. In response, some online retailers have taken to banning users who make too many returns.
Mork faces a maximum of 40 years in prison for the crimes. He is currently out on bail and his sentencing hearing is scheduled for Oct. 21, 2019 in San Jose.