Can I fix an Iphone 5 bad esn?

Ok so i'm in mexico and i don't want to pay the 1000 dollars for an iphone 5 64g, my friend has one on att in america and if he reports it stolen they will send another one to him for like 250 and put bad esm his old one. If i was to put a Telcel (mexican phone carrier) sim card in it would it connect to the network? Of course after it gets unlocked/flashed?

If he reports it as stolen you won't be able to activate. When he reports it as stolen it won't necessarily "flag" on ATT'S end, it will flag on iTunes. Knowing you'll hook it up they will ban the IMEI number. You won't be able to use it at all. It becomes a virtual paperweight.

Once reported stolen or lost, it will be useless on any carrier in the world.