California Man Pleads Guilty in Federal Court in Louisiana to Sim Swap Scam, Faces Up to 20 Years in Prison

Louisiana – U.S. Attorney Duane A. Evans announced that Richard Yuan Li, age 21, a resident of Hercules, California, pleaded guilty on May 17, 2022 before United States District Judge Greg G. Guidry to conspiracy to commit wire fraud, in violation of Title 18, United States Code, Sections 1349 and 1343, for his role in a SIM Swap scam that targeted at least forty people, including a New Orleans-area physician (Victim A).

A SIM Swap scam, according to court documents, 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 multi-faceted scheme. First, they defrauded Apple, Inc. into providing a second Apple iPhone without paying for it in January 2018 by convincing an Apple customer service representative that they had not received an Apple iPhone 8 they ordered (hereinafter “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 the Apple iPhone 8, which LI kept in his dorm room at a California university. The SIM swap resulted in the transmission of a series of writings, signs, signals, and sounds that crossed state lines, including those between Florida, Louisiana, and California. LI and his co-conspirators then gained access to Victim A’s email and cryptocurrency accounts. Following that, one or more conspiracy members called Victim A and threatened to release the contents of his email account unless Victim A paid a 100 Bitcoin ransom.

Before Victim A was able to regain control of his accounts, they were able to steal approximately $57,117.50 in cryptocurrency. LI’s participation in another person’s SIM Swap on December 4, 2018, cost that victim approximately $4,000. Between July 19, 2018, and December 6, 2018, LI and his co-conspirators engaged in unauthorized SIM Swaps that targeted at least forty victims.

LI faces a maximum sentence of twenty years in prison, a fine of up to $250,000.00, up to three years of supervised release after incarceration, and a mandatory special assessment fee of $100 per count. He may also be ordered to compensate the victims for their losses. The sentencing hearing before Judge Guidry has been set for August 9, 2022.

U.S. Attorney Evans praised the Federal Bureau of Investigation’s work. The prosecution is being led by Assistant United States Attorney Jordan Ginsberg, the Chief of the Public Corruption Unit.