The FCC voted this week to close a loophole that allows criminals to more easily profit from stolen smartphones — fueling retail theft and strengthening organized crime networks involved in trafficking devices.
“Today, the FCC closed a loophole in our rules that sophisticated criminal networks and everyday lawbreakers alike exploited to steal smartphones,” wrote FCC Chairman Brendan Carr on X. “This not only contributed to retail theft but enabled handset trafficking that provided a key revenue stream for organized criminal syndicates.”
Carr’s statement points to long-running concerns about phone unlocking rules that can inadvertently make stolen devices easier to resell. Once a handset is unlocked, it may be more readily sold on secondary markets or shipped overseas, complicating efforts by law enforcement, retailers, and victims to recover property or shut down trafficking pipelines.
Industry and public safety advocates have argued that smartphone theft is no longer just opportunistic shoplifting — it has increasingly become an organized enterprise. Under this model, thieves target stores and individuals for high-volume device theft operations, funnel the phones to intermediaries, and then move the devices through international resale channels where they fetch a high price.
The FCC action targets policies that have allegedly lowered barriers for criminals to monetize stolen phones quickly, making smartphones an even more attractive prize for theft rings. Carr framed the issue as both an economic and public safety threat, arguing that the proceeds from handset trafficking often support broader criminal operations.
Carr also emphasized that the effects of smartphone theft go well beyond the inconvenience of replacing a device. He argued that the theft-and-trafficking ecosystem ties into serious criminal activity — including networks linked to narcotics distribution and human smuggling — by providing criminals with an additional stream of cash and an easily transportable commodity.
Supporters of the move say the FCC is taking a practical step toward cutting off that revenue stream by tightening the regulatory structure around unlocking requirements. They argue that rules should protect consumers without unintentionally turning stolen phones into fast-cash assets for organized crime.
The vote reflects a broader shift in communications policy toward enforcement priorities and crime prevention, with Carr casting the regulatory change as a direct strike against networks that exploit federal rules for illegal gain.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.