Police smash £1.2million global iPhone scam with raids across Britain Last updated at 1:58 PM on 18th August 2010 British police have shut down an international scam in which gang members used stolen phones to ring up millions of pounds worth of calls to their own premium phone lines before pocketing the profits. Nine people were arrested following raids at homes across London, Birmingham and Middlesbrough, and police seized dozens of iPhones, hundreds of Sim cards, bank cards, fake passports and cash. The raids followed a month-long investigation into a rapidly growing criminal conspiracy profiting from the theft and illegal use of almost 1,000 iPhones. Arrests: Police raid an address in Birmingham, as officers shut down a global scam suspected of milking millions of pounds from stolen iPhones through premium phone lines West African fraudsters allegedly used false identities and fake credit cards to sign up to O2 phone contracts, which gave them iPhone handsets complete with Sim cards. They then sold the brand new phones to a middleman who removed the Sim cards and unlocked the handsets before selling both to the alleged London and Essex-based crime gang. The phones and Sim cards were then sent to gang members in the Middle East, Vietnam and Europe, where the handsets were sold off and the Sim cards were used as part of a sophisticated electronic scam. The gang set up their own premium rate phone lines and plugged the Sim cards into automatic calling devices which continually rang their own lines at a charge of £10 a minute. A loophole within the phone market means providers are liable for any bills racked up abroad, which they then claim back from the customer. The gang pocketed £1.2million in July alone, which was paid by O2 to the owners of the premium phone lines - which happened to be the gang. When O2 went to recoup the bill from the fraudsters who purchased the initial phone contracts, they discovered the accounts had been set up using false identities and the customers did not exist. Raid: A suspect is arrested by officers in Southend, Essex, as part of raids on homes across the UK Phone scam: Nine people across Britain were arrested as part of the conspiracy, which spread as far as the Middle East and Asia Police arrested several members of the premium phone line gang, all of whom are of Pakistani origin, at homes in Forest Gate, Southall and Southend. They are suspected of setting up a complex network of shell companies to launder the profits from the premium phone lines and hide their identities. At one home in Forest Gate, police found hundreds of Sim cards, £15,000-worth of iPhones still in their boxes, 20 bank cards and several fake passports. At another property they also found hundreds of letters that had been prepared to try and con people out of their savings with a promise of a lottery win, a scam known as a 419 con. Investigators have traced the stolen handsets and Sim cards all over the world, including several countries in the Middle East, continental Europe and Vietnam. Evidence: An officer holds the handsets collected as evidence from a raid in Essex, including several iPhones Swoop: A man sits in handcuffs after a raid in Birmingham They want to know where the profits went, as many of those involved lived 'under the radar' in council houses with few obvious assets, apart from relatively smart cars. Detective Superintendent Bob Wishart, of City of London Police, which is the national lead force for fraud, said: 'Today we have struck at the very heart of a highly sophisticated criminal network that has been targeting the telecommunications industry to steal millions of pounds. 'Our investigation found a crime gathering momentum. Each month more Sim cards were being used to make more phone calls to premium rate lines at more expense to the network provider. 'The criminal exploitation of the latest consumer technology is a recurring theme of our work. 'Our collaboration with O2 on this investigation highlights the benefits of how the private sector can work with the police to proactively target common threats to our communities.' Adrian Goreham, who is responsible for tackling fraud at O2, said: 'This was a sophisticated and organised attempt to defraud mobile phone operators. 'We are committed to reducing mobile phone crime and have a dedicated team that monitors and investigates such attempted criminal activity. Those arrested were aged between 18 and 42.