They did not make efforts to return the iPhone to the likely owner, which was a very simple thing to do.
I'm not defending the guy who found it, but my understanding is that he did try to return it. He called Apple many times and tried telling them, but (as usual) the Apple reps didn't know better about it and told him it was likely a fake. Again, I'm not defending him at all (he shouldn't have sold the phone), but I have to give him some credit. Unfortunately, it's hard to get a hold of an Apple exec (even more so if you are an average user who doesn't know much about Apple). If my parents/friends were to find the phone, they'd have no idea that they would need to email Steve ... they'd just call Apple (which is what the guy did).