As a company, you’d probably think of Apple as a company that uses only the highest quality components. That’s probably not too far from the truth. But it looks like even rejected parts are good enough to pass for an actual product. A number of Foxconn employees have been selling phones made using rejected parts, and have made NTD1.3 billion (~RM173.4 million) in three years.
Taiwan News reports that a businessman worked with a group of Foxconn’s management staff to get rejected iPhone parts. These defective parts were supposed to be destroyed, according to normal procedures. Instead, they are assebled and then sold as if they were products that rolled out of the manufacturing line.
The fraud was discovered and reported to Apple, which has since launched a formal investigation. According to Taiwanese site Mirror Media, a whistleblower emailed Tim Cook himself to report the fraud going on at Foxconn. As for the investigation, it is reportedly being investigated by Apple’s business Assurance & Audit team, which reports directly to Apple’s board of directors.
It’s an unusual case to be sure, for those within the iPhone manufacturer to be responsible for defrauding Apple. Former Foxconn chairman Terry Guo is cited as saying that, in a company with over a million employees, it’s unsurprising for “unreasonable things” to happen involving a few bad apples.