A Pakistani man has been sentenced to 12 years in prison for installing malware on AT&T’s internal computers to help him illegally unlock nearly 2 million phones tied to the carrier.
Muhammad Fahd, 35, was extradited from Hong Kong to the US in 2019. His scheme, which occurred from 2012 to 2017, sought to exploit how AT&T subsidized the cost of smartphones, including the iPhone. Consumers could buy the products at reduced costs, but the devices were locked to AT&T’s networks so customers couldn’t drop the company for another carrier.
In response, Fahd partnered with online retailers to offer cell phone unlocking services in exchange for a fee, which could range from $1.99 to $74.99, or higher. To pull this off, he began bribing AT&T employees at a call center in Washington state who had access to company systems capable of unlocking the phones.
Fahd first kicked off the scheme by using Facebook to bribe an AT&T employee into joining the conspiracy. “Fahd also asked the employee to recruit other AT&T employees to help with the unauthorized unlocks,” the US Justice Department announced this week.
However, in 2013, his scheme faced a potential roadblock when AT&T implemented a new system to help prevent the phone unlocking. But Fahd eventually came up with a workaround: He decided to hire a software developer to create malware capable of remotely manipulating AT&T computers into unlocking the phones for him. Fahd then bribed AT&T employees to help secretly plant the malicious code into company systems.
That same year, AT&T discovered Fahd’s malware on its network, which prompted the dismissal of three AT&T employees involved in the scheme. This likely helped federal investigators identify and nab Fahd, who continued his phone-unlocking scheme until September 2017. The next year, Fahd was arrested in Hong Kong. He was extradited in August 2019 and pleaded guilty before a US District Court in Seattle to conspiracy to commit wire fraud a year later.
AT&T estimates it lost $200 million in business from the phone unlocking due to customers failing to make their payments, the Justice Department said.
