Iran’s Economic Woes Sparked by iPhone Ponzi Scheme as Demand for Luxury Goods Remains High

The Unlikely Culprit: A Multimillion-Dollar Ponzi Scheme in Iran

In a country where the Supreme Leader has denounced American luxury goods amid years of tensions with the West, consumers in Iran are still clamoring for iPhones. The demand is so high that it has led to a multimillion-dollar Ponzi scheme, according to police and prosecutors.

The Kourosh Company: A Scam in the Name of Luxury

The Kourosh Company, which used celebrities in online ads to promote its products, promised customers iPhone 13s starting from $360 - if they were willing to pay upfront and wait a few weeks for delivery. Some customers initially received their iPhones, fueling the frenzy surrounding the shop. But when the devices dried up, it became clear that the company was running a scam.

The Mastermind on the Run

The alleged mastermind of the scheme, Amirhossein Sharifian, 27, fled Iran in September with millions of dollars in payments, according to Iranian authorities. Investigators are still searching for him.

Economic Woes: A Perfect Storm of Challenges

Iran’s economic problems have been exacerbated by its rapid advancement of its nuclear program, support for proxy militias in the Middle East, and violent crackdown on dissent ahead of parliamentary elections next week. The country’s currency has depreciated significantly, making imports more expensive and sparking a parallel economy for older iPhones.

The Banned iPhone: A Lucrative Business Opportunity

The government banned Apple’s iPhone 14 and 15 from the country last year, but this only fueled demand for the devices. The ban led to the creation of a lucrative business importing iPhones individually by travelers who would then register them at the country’s entry point. This sparked a side business where iPhone traders would pay passengers up to $40 for their passport numbers to use to register iPhones in their stock.

Economic Challenges and Luxury Goods

Economic woes have played into schemes like Kourosh, with inflation overtaking any interest rate offered by a bank and depreciation gnawing away at people’s savings. Many are seeking physical assets such as homes, jewelry, or cars to protect against losses.

Demand for iPhones Remains High

Despite the economic challenges facing Iran, demand for iPhones remains high. “I prefer the iPhone to any other phone, at any price, because it cannot be compared to any other brand in terms of luxury,” said Ehsan Ehsani, a 23-year-old architecture student in Tehran.

Rules and Restrictions: A Challenge to Entrepreneurs

Rules on importing iPhones into Iran were always tough, with restrictions making it difficult for individuals to bring them into the country. But even with these limitations, demand remains high and entrepreneurs are finding ways to capitalize on this desire.

Conclusion: Economic Woes and Luxury Goods in Iran

The controversy surrounding Kourosh is a sign of the economic woes plaguing Iran as the country struggles to balance its need for luxury goods with the constraints imposed by Western sanctions and its own economic challenges.