BBB Alerts Consumers to iPhones Rip-offs

Austin, Texas, September 4, 2008 - Within three days of its release, Apple sold one million iPhone 3Gs. Such widespread excitement over a product means that scammers have a new opportunity to rip-off unsuspecting consumers, and your BBB is providing advice on how consumers can protect themselves from the many schemes associated with the product.

"When it comes to hot, new technology that has everyone buzzing, consumers can get caught up in the craze and may let their common sense lapse," says Carrie A. Hurt, President and CEO of BBB Serving Central, Coastal and Southwest Texas. "The latest example is this summer's introduction of the new iPhone, and while consumers are still scrambling to get their hands on one, scammers are taking advantage of an opportunity to get their hands on consumers' money."

BBB wants consumers who are looking to purchase, or who have already purchased an iPhone, to be aware of the following ways they could be ripped off.

Shopping with Unauthorized Sellers
Some eager early adopters decided to avoid long lines outside Apple and AT&T stores and tried buying an iPhone online. Unfortunately, many were fooled by scammers who had set up websites posing as legitimate retailers, brokers and resellers or posted ads online at classified sites such as Craigslist. Typically, victims were asked to wire payment for the phone to the scammers, and of course, the iPhones never arrived. In an even worse case scenario, the NYPD recently busted a ring of crooks placing ads on Craigslist for iPhones. However, when buyers arrived to complete the transaction, they were robbed, ending up with no iPhone and no money.

Effective September 7, electronics retailer, Best Buy, will be selling iPhones, providing customers with a third outlet for purchase-in addition to Apple and AT&T stores. BBB advises consumers to purchase new iPhone 3Gs only at authorized stores and to never wire money as payment when shopping for a secondhand iPhone online.

Jailbreak Leads to Heartache
The iPhone was released exclusively for use with Apple-designated software and with AT&T as the wireless provider. However, hackers have figured out ways to "jailbreak" or "unlock" iPhones, enabling the phones to use software that is not authorized by Apple or to run on different wireless networks other than AT&T.

BBB has received complaints from iPhone users who put their trust in websites that sold software that would supposedly "jailbreak" or "unlock" their phone. Complainants state that, despite promises and satisfaction guarantees, they never got their money back. BBB advises that hacking into an iPhone and installing any unauthorized program is extremely risky and could seriously damage the product or may void the warranty, leaving the owner with a worthless- albeit expensive-piece of broken hardware.

Apps Mishaps
One new feature introduced for the iPhone 3G, as well as the new iPod Touch, is the option to install applications or Apps. Apps are small programs that perform specific functions-such as tracking sports scores or enabling the use of games-that users can upload to their device. Apps have proven to be extremely popular and, while some are available for free, Apple sold more than $30 million worth of Apps in the first month alone after introduction.

The Apps Store in iTunes www.apple.com/it unes is the only authorized distributor of Apps, but that hasn't stopped a legion of websites from cropping up, all promising to sell Apps at discounted prices. BBB strongly advises consumers to stay away from websites promising deals on Apps as these sites are most likely a ruse, set up only to take a consumer's money and offering nothing in return, and could potentially be sites that install viruses or malware onto a user's computer for identity theft purposes.

For more advice on how to avoid getting ripped off when going after the latest technology, go to www.bbb.org.