Apple fined $9 million for misleading customers with faulty iPhones and iPads

Apple fined $9 million for misleading iPhone and iPad owners in Australia over

An Australian court fined US electronics giant Apple Inc A$9 million ($6.7 million) on Tuesday after a regulator accused it of using a software update to disable iPhones which had cracked screens fixed by third parties.

"[The customers said] they were being refused a remedy of any kind by Apple on the basis that their device had had unauthorised repairs, and those repairs could be as minor as just having a cracked screen replaced on an iPhone or iPad, which all of us need to do from time to time", ACCC Commissioner Sarah Court said.

Apple offered a court-enforceable undertaking to improve training and audit information about warranties and the Australian Consumer Law on its website, the ACCC said.

At least 275 Australian customers affected by the were told by Apple they couldn't get a refund if they used a third party to try and fix the problem.

The problems occurred after Apple released its iOS 9.2.1 mobile operating system, which contained a factory test meant to verify the Touch ID fingerprint authentication scanner on a device was genuine. It released an iOS 9.2.1 update later that February to restore bricked devices, but reports showed it did not re-enable Touch ID and customers complained they still lost photos, documents and apps.

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Apple has since admitted that from February 2015 to February 2016, its U.S. website and Apple staff in Australian stores and on customer service phone calls said to 275 Australian customers affected by Error 53 it wasn't responsible for a remedy.

After the ACCC contacted Apple regarding the investigation, Apple undertook an outreach program to contact an estimated 5,000 customer suspected of being affected by error 53. Apple has committed to provide new replacements in those circumstances if the consumer requests one. That allegedly involved Apple exchanging faulty iPhones and iPads for refurbished replacements, not completely new devices.

Prior to the decision, Federal Court judge Mark Moshinsky had referred Apple and the ACCC to mediation over the matter in November.

"If people buy an iPhone or iPad from Apple and it suffers a major failure, they are entitled to a refund", said Court.

There was no immediate comment from Apple, which has previously described the error as appearing "when a device fails a security test".

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