How Hackers and Scammers Break

Last month, there were a string of similar muggings in Philadelphia. In each of these muggings, the perpetrator allegedly held the victim up at gunpoint, demanded that they pull out their iPhone, and gave them instructions: Disable “Find My iPhone,” and log out of iCloud.

In 2013, Apple introduced a security feature designed to make iPhones less valuable targets to would-be thieves. An iPhone can only be associated to one iCloud account, meaning that, in order to sell it to someone else (or in order for a stolen phone to be used by someone new) that account needs to be removed from the phone altogether. A stolen iPhone which is still attached to the original owner's iCloud account is worthless for personal use or reselling purposes (unless you strip it for parts), because at any point the original owner can remotely lock the phone and find its location with Find My iPhone. Without the owner's password, the original owner's account can't be unlinked from the phone and the device can't be factory reset. This security feature explains why some muggers have been demanding passwords from their victims.

The iCloud security feature has likely cut down on the number of iPhones that have been stolen, but enterprising criminals have found ways to remove iCloud in order to resell devices. To do this, they phish the phone’s original owners, or scam employees at Apple Stores, which have the ability to override iCloud locks. Thieves, coders, and hackers participate in an underground industry designed to remove a user’s iCloud account from a phone so that they can then be resold.

Making matters more complicated is the fact that not all iCloud-locked phones are stolen devices—some of them are phones that are returned to telecom companies as part of phone upgrade and insurance programs. The large number of legitimately obtained, iCloud-locked iPhones helps supply the independent phone repair industry with replacement parts that cannot be obtained directly from Apple. But naturally, repair companies know that a phone is worth more unlocked than it is locked, and so some of them have waded into the hacking underground to become customers of illegal iCloud unlocking companies.

In practice, “iCloud unlock” as it’s often called, is a scheme that involves a complex supply chain of different scams and cybercriminals. These include using fake receipts and invoices to trick Apple into believing they’re the legitimate owner of the phone, using databases that look up information on iPhones, and social engineering at Apple Stores. There are even custom phishing kits for sale online designed to steal iCloud passwords from a phone’s original owner.