A Michigan-based scammer who illegally acquired more than 9,000 replacement iPod shuffles now faces prison, as several reports indicate. Nicholas Woodhams has pleaded guilty to fraud and money laundering scheme and is to be sentenced August 25, 2009. The story, however, has quite a few twists.
According to The Independent, twenty-three-year-old Nicholas Woodhams of the Kalamazoo area, appeared in federal court in Grand Rapids on Monday, less than a month after charges were filed. Woodhams owned an iPod repair shop, which he used to get replacement iPods from Apple by guessing at valid serial numbers or 'stealing' those from the real iPods that came in for repairs.
After receiving the replacement shuffles from Apple, Woodhams would sell them, thus affording an Audi S4 sedan, a race car, a motorcycle, six computers and more (which he now has to give up, along with a property in Portage and $570,000). As court filings reveal, Woodhams had acquired more than 9,000 replacement iPod shuffle music players using the aforementioned scamming methods. While Woodhams awaits for his sentence to be pronounced on August 25, a message seeking comment was left with his lawyer, according to The Independent.
Nicholas Woodhams first made the news in mid-2008 when he had forgotten, or refused to change the name of his shop and web site that were called “iPod Mechanics.”
(How do you refuse / forget to change the name of your scammy shop when you know trademark troubles are a joke compared to the slammer time you deserve for your scheme?)
Then, Apple learned of his scammy business. As the story goes, by guessing at valid iPod serial numbers and using credit cards that wouldn't accept charges, Woodhams illegally obtained iPod shuffles via the advance replacement program, which he then sold as new units at a lower price. At the time, Woodhams owed Apple close to a quarter of a million dollars in damages. By keeping the monkey business going, he not only ended up owing Apple over half a million dollars plus most of his goods and home in Portage, but now faces prison too.
However, Woodhams' attorney may have the answer to the question posted above in brackets. As Randall Levine, lawyer, reveals, his firm is actively cooperating with the government and is in the process of negotiating a resolution. Levine is cited as saying that Woodhams is "a very bright man" who didn't realize how serious the situation really was. No kidding?
Whether or not they come up with a resolution, one can't help wondering how some manage to get so far in their illegal actions. Next thing you know, Psystar will go door-to-door and tell every customer to give up their Leopard-running PC so that Apple can torch them all. The PCs, not the customers.