California Man Sentenced in Federal Court in Louisiana in Connection with SIM Swap Scam Targeting at Least 40 People

Louisiana – On August 10, 2022, U.S. Attorney Duane A. Evans announced that Richard Yuan Li, age 21, a resident of Hercules, California, was sentenced in a federal court in Louisiana by United States District Judge Greg G. Guidry to three years of probation and 100 hours of community service for his role in a SIM Swap scam that targeted at least forty people, including a New Orleans-area physician (Victim A). Additionally, Judge Guidry sentenced Li to pay restitution in the amount of $61,117,50 and pay a mandatory $100 special assessment fee.

A SIM Swap scam, according to court filings, is a cellular phone account takeover fraud in which a victim’s incoming calls and text messages are routed to a different phone. Once a perpetrator has obtained access to a victim’s various personal accounts, including email accounts, bank accounts, and cryptocurrency accounts, as well as any other accounts that use two-factor authentication, he is likely to gain access to any other accounts that use two-factor authentication.

Li was a part of a scheme that included several components. First, they conned Apple, Inc. into giving a second Apple iPhone without paying for it in January 2018 by convincing an Apple customer care employee that they had not gotten an Apple iPhone 8 they bought (hereafter “the Apple iPhone 8”). Li obtained the Apple iPhone 8 Plus. Li and his co-conspirators then arranged for victims’ phone numbers to be switched to SIM cards in their possession, including the Apple iPhone 8. Between July and December 2018, Li and his co-conspirators engaged in unauthorized SIM Swaps that targeted at least forty phone numbers.

On November 10, 2018, Victim A’s phone number was changed to that of the Apple iPhone 8, which Li kept at his dorm room at a California institution. The SIM switch resulted in the transmission of a sequence of letters, signs, signals, and sounds that crossed state lines, including those between Florida, Louisiana, and California. Li and his co-conspirators then acquired access to Victim A’s email and bitcoin accounts. Following that, one or more conspiracy members called Victim A and threatened to reveal the contents of his email account unless Victim A paid a 100 Bitcoin ransom. Before Victim A was able to restore control of his accounts, they were able to steal about $57,117.50 in cryptocurrencies.

Li’s participation of another individual’s SIM Swap on December 4, 2018, resulted in the victim losing about $4,000. Between July 19, 2018, and December 6, 2018, Li and his co-conspirators engaged in unlawful SIM Swaps that targeted at least forty victims. Li sold his Apple iPhone 8 to a buddy, E.W, in March 2019; on June 14, 2019, law enforcement officers executed a search order on Li’s dorm room in the San Diego, California region.

The work of the Federal Bureau of Investigation was lauded by U.S. Attorney Evans. The prosecution is led by Assistant United States Attorney Jordan Ginsberg, supervisor of the Public Corruption Unit.