Rogue T-Mobile store owner found guilty of illegally unlocking phones in $25 million fraud

A former T-Mobile store owner was found guilty of breaking into the wireless carrier’s internal system, allowing the rogue businessman to unlock and unblock smartphones. The illegal activities took place from 2014 to 2019 when 44-year-old Argishti Khudaverdyan unlocked phones from T-Mobile and other carriers’ networks so that those who bought the handsets could use them with other network providers.

The settlement provided $25 million in ill-gotten gains for the suspect and his partner

This hurt cellular carriers, many of which are giving huge discounts or giving away free phones to customers who agree to be locked into their network for years. Khudaverdyan also unlocked phones that carriers had blocked after they were reported stolen or lost. The conviction was announced by the Ministry of Justice in a press release of the US Attorney’s Office for the Central District of California.

T-Mobile was one of the carriers that was scammed in the scheme

Khudaverdyan, 44, who lives in Burbank, California, was found guilty last Friday of one count of conspiracy to commit wire transfer fraud, three counts of wire fraud, two counts of accessing a computer to obtain fraud and obtain value, one count of intentional access to a computer without permission to obtain information, one count of conspiracy to commit money laundering, five counts of money laundering, and one count of aggravated identity theft.

Prosecutors said at trial that the plan generated $25 million in illegally obtained revenue because removing blocks on these phones allowed them to be sold on the black market. Khudaverdyan unlocked handsets that were locked to T-Mobile, AT&T and Sprint’s networks. He and a partner co-owned Top Tier Solutions Inc., a T-Mobile store in Eagle Rock Plaza, Los Angeles.

T-Mobile ended its contract with Top Tier in 2017 due to Khudaverdyan’s suspicious behavior and unauthorized phone unlocking. He advertised his illegally unlocked phones through brokers, email, and websites, including “unlocks247.com.” While promoting the illegally unlocked phones, Khudaverdyan advertised them as official unlocked T-Mobile phones.

Khudaverdyan is sentenced on October 17 and faces a long prison term

Unlocking these phones allowed T-Mobile customers to use other carriers, costing the company revenue from service contracts and equipment installment plans. To gain access to T-Mobile’s internal computer systems, Khudaverdyan tricked T-Mobile employees by using phishing emails to trick them into revealing information. These fake emails looked so much like legit T-Mobile correspondence that the employees passed on their login details, which allowed the convicted felon to hack into T-Mobile’s computers.

Khudaverdyan also enlisted help from foreign call centers to get employees’ credentials. Armed with this information, the bad actor then called the T-Mobile IT help desk to reset the employees’ company passwords. This gave him access to the T-Mobile systems he used to unlock phones. In the years this scheme was in operation, more than 50 T-Mobile employees had their credentials stolen and hundreds of thousands of handsets unlocked.

Sentencing will take place on October 17, and Khudaverdyan will face statutory maximum sentences of 20 years in federal prison for each count of wire transfers, 20 years in federal prison for conspiracy to commit money laundering, 10 years in federal prison for each count of money laundering, five years in federal prison for each count of intentionally accessing a computer without authorization to obtain information, five years in federal prison for the count of accessing a computer to defraud and value and a mandatory two years in federal prison for aggravated identity theft.

His partner and co-defendant, Alen Gharehbagloo, 43, of La Cañada Flintridge, pleaded guilty on July 5 to three counts: conspiracy to commit fraud, access to a secure computer with intent to commit fraud, and conspiracy to launder money. . He is sentenced on December 5.