Here's a full time line with all the facts as we know them:
http://www.pcworld.com/article/19459..._timeline.html
My question is why didn't he just call the dude who owned the phone? He had turned it on and identified him through the Facebook app. He could have sent him an email or left him a message ("I have your phone."). It's obvious he did very little to get the phone back to its rightful owner. I think the State of California is agreeing with this and hence the investigation.