Earlier this year we examined just where stolen mobile phones go. The ease and profitability of selling stolen devices to International markets (particularly countries in Latin America, EMEA and Asia Pacific) has spiked the growth in mobile crimes. One couple made nearly $4 million in 8 months as middlemen selling phones to Hong Kong, where they can fetch as much as $2000 per phone. The demand in developing markets for handsets is greater, pushing up the price.
Huffington Post put together a lengthy article that examines the Global black market for smartphones, showing just how lucrative the market is. Ace Wholesale in Michigan was trading such high volumes in phones and iPads that managers installed a port-a-potty and an armoured truck arrived each day to re-supply their cash. According to witnesses, prior to the storefront being shut down last summer, you could come in with a bag of phones and easily walk away with $20,000.
Jerry Deaven, an agent with the Department of Homeland Security, says that some of these trafficking organizations are shipping millions of dollars worth of phones per month out of the country. Marci Carris, vice president of customer finance services at Sprint, says phones stolen in the United States have been located on all continents except Antarctica.
The Huffington Post article details how phone traffickers originally had "runners" agree to long-term contracts to buy discounted phones, then have them stop paying the bills and sell the phones oversees. Though this can be done in bulk, it is clear that traffickers are now also purchasing phones that have been acquired through robberies, increasingly met with violence. Many of these middlemen in the global smartphone marketplace will hire hackers to "unlock" devices and erase its data, often within an hour of it being stolen.
While police are doing their part to shut down these traffickers, the demand is so high that other traffickers are stepping up to fill the void.