Police have broken a major scam ring involving O2 and the iPhone. O2 indicates it has been losing over £1 Million a month from the fraudsters. By stealing the iPhones (around 1000 on their own, worth an average of $199,000) the criminals have been sending them abroad where operators apparently are unable to block the phone. On the black market the phones can fetch £450 each.

By hooking the phone up to automatic dialing machine set to reletatively call premium rate numbers often charging £10 a minute they have been able to make a significant amount of money. The funds were being distributed through companies setup to hide the fraud and attempt to keep the identities of those behind it secret.

The nine men arrested in police raids are all of Pakistani origin may have been planning to do the same thousands times more based on the amount of evidence ceased during the raids. £15,000 worth of mobile phones, fake identify documents, sim cards and cash.

References
The Independant
BBC News