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With flashy celebrity ads and promises of deep discounts, a shop in Iran’s capital had offered consumers in the Islamic Republic one of the hottest products in the country — an iPhone that came out in 2021.
However, instead of receiving the phones, authorities in Iran are accusing a business owner of orchestrating a Ponzi scheme, defrauding customers of millions of dollars.
However, the dispute regarding the Kourosh Company, also known as the “Son of the Sun” Company, goes beyond the alleged scam.
Iran’s struggle with economic distress, caused by decades of Western sanctions, is evident. This has worsened due to its rapid progress in the nuclear program, supplying weapons to Russia for their conflict in Ukraine, increasing aid to proxy militias in the Middle East, and forcefully silencing dissent before Friday’s parliamentary elections.
Last year, the government prohibited the use of Apple’s iPhone 14 and 15 in the Islamic Republic. This led to the rise of a separate market for older models, causing prices to increase as individuals attempted to convert their decreasing Iranian rials into tangible goods.
Despite the ongoing tensions with the West, consumers continue to desire American luxury goods, despite Supreme Leader Ayatollah Ali Khamenei’s disapproval. These products, particularly smartphones, are still sought after due to their association with prestige.
According to Aram, a mobile phone vendor in Tehran who requested to remain anonymous, there is high demand for the “newest couple of iPhone models,” despite them being restricted.
She mentioned that it would be greatly beneficial if they permitted legal imports.
In Iran’s stores, the price for iPhone 13s ranges from $330 for refurbished models to $1,020 for brand new ones. However, they are not yet as desirable as the iPhone 15, which is now sold in other parts of the world.
Even if you bring an iPhone 14 or 15 model into the country, it will stop working on the Iran’s state-controlled mobile phone networks after one month, the time span for tourists who visit the county.
The import of iPhones has been a source of disagreement for a while now. According to government data, iPhones made up around 33% of Iran’s $4.4 billion market for imported mobile phones before the ban was imposed.
Private companies importing mobile phones benefit from government-regulated exchange rates that are significantly lower than the 580,000 rials to $1 rate offered by exchange offices. This makes the business even more profitable for them.
When Iran and world powers agreed on the 2015 nuclear deal, $1 was equivalent to 32,000 rials.
In August 2020, during remarks to government ministers, Khamenei specifically denounced the importing of iPhones.
According to a transcript on his official website, Khamenei stated that importing too many goods is risky. He mentioned that sometimes the imports include unnecessary luxury items, such as a specific American cellphone that reportedly cost half a billion dollars.
However, the desire for iPhones continues to exist and they continue to serve as a symbol of social status for numerous young individuals in Iran.
A 23-year-old architecture student in Tehran, named Ehsan Ehsani, stated that he favors the iPhone above all other phones, regardless of cost, due to its incomparable level of luxury compared to other brands.
Guidelines for bringing iPhones into Iran have consistently been stringent.
Travelers must bring in their phones individually and declare them for personal use at the country’s entry point. At customs, a fee of 22.5% of the phone’s price, as determined by the government or a sales receipt, must be paid after providing passport numbers.
This led to the development of a secondary enterprise in which individuals would trade iPhones with airport passengers, offering payment in return for permission to use their passport numbers to register the devices in their inventory.
Navid Bahmani is a 26-year-old employee at an iPhone shop in the city of Tehran. He has been known to offer travelers up to $40 in exchange for their passport numbers at Tehran’s Imam Khomeini International Airport.
According to Bahmani, the cost is determined by the travelers. While some may agree to the initial proposal, others may reject it.
There was no response from Apple, located in Cupertino, California, when a comment was requested.
The economic issues of Iran have also contributed to schemes like Kourosh’s, which is coincidentally also the name of the dynasty under Cyrus the Great.
Inflation has surpassed the interest rates provided by banks and depreciation has diminished individuals’ savings. As a result, many are looking to invest in tangible possessions, such as a house, jewelry, or even a vehicle, as a safeguard against financial losses.
The Kourosh Company was instrumental in this situation.
The company offered iPhone 13s starting from the equivalent of $360 — if you were willing to pay first and wait for a few weeks before receiving the device. Celebrities in Iran appeared in online ads for the firm, drawing even more attention.
Initially, a group of customers were able to obtain their iPhones, adding to the excitement surrounding the store. According to Shargh, a progressive newspaper, the company is estimated to have earned $36 million in under a year, although this information has not been officially confirmed by officials.
Next, the supply of iPhones diminished.
Iranian officials claim that Amirhossein Sharifian, who worked as CEO for 27 years and is suspected of being the mastermind behind the plot, abruptly fled the country in September, and is currently evading capture with several million dollars in payments.
The Associated Press was unable to get a comment from Sharifian, but an employee of the company claimed in a video posted two weeks ago that a delay in iPhone deliveries was due to supply chain problems.
The spokesperson for the Iranian police, General Saeed Montazeralmehdi, reported that authorities are continuing their search for Sharifian.
Despite the commotion, patrons continue to queue outside the store, even on a recent day with below-freezing temperatures in Tehran.
“I purchased nine iPhones,” explained Moteza Zarei, a 47-year-old owner of a car repair business. “I thought it would be a smart investment, but unfortunately, I did not receive any.”
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Journalists for the Associated Press, Amir Vahdat and Mehdi Fattahi, contributed to this report from Tehran, Iran.
The information is from an article on the website independent.co.uk.
