12 people charged in iTunes royalty fraud

I guess with all of the money flowing around iTunes, sooner or later someone would have to try to steal some of it. Twelve people have been charged in the UK with basically laundering money through iTunes -- they were allegedly uploading their own tracks onto the music sales service, then buying those same tracks with stolen credit card numbers. The fraudsters nabbed over $300,000 worth of royalties in just a four month period between September 2008 and January 2009.

The Register doesn't note how the 12 (who come from a surprising number of various jobs and backgrounds) came up with this idea, or how they got caught, although there was an investigation underway by the FBI. iTunes wasn't the only service defrauded -- Amazon was reportedly used for some of the transactions as well.

The suspects are scheduled to appear on bail next month, and I'm sure both Apple and Amazon have taken steps to make sure this doesn't happen again. Even so, out of all of the millions if not billions of dollars running through iTunes, if this $300,000 is all of the theft they need to worry about, Apple's doing pretty well anyway.

[via MDN]

View Tags

Source: http://www.theregister.co.uk/2010/08/23/itunes_fraud_court/

Categories

iTunes

I guess with all of the money flowing around iTunes, sooner or later someone would have to try to steal some of it. Twelve people have been...

Add a Comment

Sign in »

6 Comments

Filter by:

Mark

Yes milk, the bank will probably reclaim the funds from Apple, but even if they succeed, it's still revenue neutral for Apple. And if they hadn't been caught, Apple would have had it's 30% or whatever. Apple was not defrauded â€” at least, not materially.

August 24 2010 at 12:25 PM Report abuse Permalink rate up rate down Reply

Mark

Apple wasn't defrauded â€” it made money by keeping its cut of the transactions. That was the price the money launderers paid to end up with clean cash. And I'll bet they were caught by some algorithm within iTunes that detected odd activity.

August 24 2010 at 9:07 AM Report abuse Permalink rate up rate down Reply

1 reply to Mark's comment

milkmage

i don't know about UK laws, but here in the states, the bank must cover the loss.. Apple won't get their cut - the banks will take all of it back (the original amount charged)

August 24 2010 at 11:47 AM Report abuse Permalink rate up rate down Reply

Jim

"if this $300,000 is all of the theft they need to worry about, Apple's doing pretty well anyway".......

Unless you happen to be one of the persons who lost money!

August 24 2010 at 9:06 AM Report abuse Permalink rate up rate down Reply

airmanchairman

The Apple eco-system is presently awash with cash and burgeoning earnings from bumper sales of hardware, accessories and software, so this is hardly a surprise. Ditto for Amazon.

It's like ants to a lump of sugar.

They say money is the root of all evil - it isn't; it simply is an irresistible magnet for all sorts, including the good and loads of evil-intentioned PEOPLE.

They say absolute power corrupts absolutely - it doesn't; it simply serves as an irresistible magnet for corrupt PEOPLE and those who would use it for perverted ends.

August 24 2010 at 8:41 AM Report abuse Permalink rate up rate down Reply

1 reply to airmanchairman's comment

rogerruthberg

It is not money, but the love of money that is the root of all evil. And make no mistake: power corrupts. Nevermind the corrupt people attracted to power, because they were corrupt to begin with, and therefore cannot serve the argument. Look at well-intentioned citizens that enter the corridors of power for all the right reasons, and end up crossing the fine line between compromise and corruption, often inadvertently and without any intent. THAT is the corrosive nature of power that must be guarded against.

August 24 2010 at 10:40 AM Report abuse Permalink rate up rate down Reply