Re: Prepaid cellphones: terrorist weapon or hot gray market item?

["Dennis Henderson" <hendomatic () gmail com>]

On 8/13/06, Richard M. Smith <rms () bsf-llc com> wrote:
>  Here's an article I found that talks about the gray market for TracFone
> phones that are purchased at Walmart and resold at a profit.
>
> Richard
>
> Posted by: Jaime R  <http://profile.typekey.com/Jaime%20R> at August 10,
> 2006 02:55 PM
>
> I tend to agree with Lawmans points. Plenty of people engage in buying
> bulk cellphones -- especially tracfones. just look on ebay. Most are sold in
> the US by the thousands per month. this is legal.
>
> What is going on is tracfones are sold in the US at a substantial subsidy
> and low minute intial purchase phones are way cheaper than buying phones
> outright.
>
> Tracfone works on GSM and it is easy to remove the chips, unlock the
> phones subisidy lock (not in itself illegal) and ship the phones for a good
> profit. Indeed a HUGE number of new unlocked tracphones are sold in the US
> on EBAY everyday for about $20 over retail. bulk buying in lots of 10 to 20k
> is at $25 a unit.
> http://www.alibaba.com/manufacturer/13876937/Buy_Nokia_Tracfone_1100.html
>
> Looking at walmart this week they had a tracfone on sale for an unusually
> low $15wiht calling credits -- and this phone is currently on sale on ebay
> for $60 new unlocked.
>
> The chips are removed becasue they typcially have a $20 residual value IN
> THE US. Just look on ebay.
>
> So yes they are used by drug dealers, terrorists etc but but 99.99% of the
> time this exact same scheme on a much larger order of magnitude is used in
> the US, stays in the US, and has nothign to do with anything criminal and is
> just taking advantage of a price differential caused by the phone subisisdy.
> In markets this is called -- arbitrage.



Full disclosure, the link is here to get more comments:

http://debbieschlussel.com/archives/2006/08/all-american_te.html

I personally think Jaime R has no clue what he's talking about.. All this
sneaking around for such a little profit.. Hell you can work less and earn
more running drugs..

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