Google, Apple asked to review fraud protection with crypto apps

The executives of Google and Apple are staring down requests for information from the US government about how the tech giants implement security measures and monitor crypto fraud in mobile applications hosted on their app stores.

Senate Banking, Housing and Urban Affairs Committee Chairman Sen. Sherrod Brown (D-OH) sent two nearly identical letters Thursday to Google’s Sundar Pichai and Apple’s Tim Cook.

Brown, the committee’s chair since February, is asking the companies to describe their review processes for apps entering their stores, as well as how they go about vetting certain apps that circumvent their store policies.

Issuing a request for information from the California-based tech giants comes as the senator has stepped up efforts to understand the extent of crypto-related fraud. Also Thursday, Brown chaired a hearing on “Protecting Investors and Savers: Understanding Fraud and Risks in Crypto and Securities Markets.”

In it, the committee heard about how actors use marketing as a means to promote fraud, including through the use of apps located in Google’s and Apple’s stores.

Melanie Senter Lubin, President of the North American Securities Administrators Association and Gerri Walsh, Senior Vice President of Investor Education at the Financial Industry Regulatory Authority both provided their insights during the hearing.

In his letters, the senator also seeks information about the systems and processes companies have in place for people to report fraudulent apps, as well as actions taken to notify users of fraudulent crypto app activity.

“While firms offering crypto investments and other related services should take the necessary steps to prevent fraudulent activity, including warning investors about the rise in fraud, it is equally important that app stores have the proper security measures in place to prevent fraudulent mobile application activity”, wrote the senator in both letters.

Apple and Google are encouraged to respond to the senator’s request for information by August 10, 2022.

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