AT&T sues three former employees over secret phone-unlocking scheme

AT&T has filed a lawsuit against 3 former call center employees, accusing them of installing malware on their servers with the goal of aiding a phone unlocking service obtain AT&T unlock codes. Most carriers, including AT&T, often sell phones at discounted rates because they know they can recoup that money by selling their own wireless services for the devices.

Smartphones are “locked” into carriers, forcing customers who buy a phone for one provider stick with that company if they don’t want to buy another phone. According the the lawsuit, the reps were paid $2000 every two weeks for their cooperation (netting between $10,500 and $20,000 before the scam was discovered) and Swift Unlocks gained access to “hundreds of thousands” of unlock codes.

The company in question is Swift Unlocks, a Web portal which provides phone unlocking services.

The defendants have not yet filed a response with the court.

In all, AT&T says “hundreds of thousands” of phones were unlocked as a result of the scheme.

The lock lasts at least until the customers’ initial contract is up and, even then, a lift on the lock must be specifically requested by the customer. The website asks for a select fee to unlock certain line of devices and carriers though AT&T is questioning how Swift Unlock was able to obtain these codes. AT&T, however, is known to have the strictest rules of all major carriers for honoring the unlock requests.

For his part, Lam was not given financial compensation, though AT&T alleges he installed malware on AT&T computers. It claims that 50 “John Doe Defendants” helped develop the unlocking software. Their names are unknown. What makes unlocking a device so desirable is the freedom consumers receive with the device.

As GeekWire reports, Sapatin, one of the three employees involved with the scheme, also tried to recruit a fourth, bragging that this scheme includes many people across the country, including other carriers outside AT&T.

Summons were issued to the defendants on Monday, giving them 21 days to respond to the complaint. Currently, Swift Unlocks is still online and offering the same unlock services.

“We’re seeking damages and injunctive relief from several people who engaged in a scheme a couple of years ago to illegally unlock wireless telephones used on our network”, AT&T spokesperson Seth Bloom told Motherboard, adding that “it’s important to note that this did not involve any improper access of customer information, or any adverse effect on our customers”.