Apple and Google are under investigation for fraudulent crypto apps
From Elon Musk Twitter impersonators to dubious Discord chats, cryptocurrency and non-fungible token (NFT) scammers have stolen billions of dollars from investors in recent years. But now politicians and law enforcement are turning their attention to Apple and Google — companies that run huge app stores — and how they assess fraudulent crypto apps.
In letters to Apple CEO Tim Cook and Google CEO Sundar Pichai on Thursday, Sen. Sherrod Brown (D-OH) asked that the companies explain their processes for reviewing and approving crypto trading and wallet apps for download in their app stores. Brown’s inquiry follows a recently released FBI report warning that 244 investors have been defrauded out of $42.7 million from fake cryptocurrency apps claiming to be credible investment platforms in less than a year.
“Crypto mobile apps are available to the public through app stores, including Apple’s App Store,” the senator wrote to Cook on Thursday. “While cryptocurrency apps have offered investors easy and convenient ways to trade cryptocurrency, reports have surfaced of fake crypto apps defrauding hundreds of investors.”
Apple and Google did not immediately respond to requests for comment.
Earlier this month, several federal law enforcement agencies, including the FBI and the Justice Department, began cracking down on fraudsters accused of stealing millions, and sometimes billions, of dollars from consumers. Although Bitcoin and other cryptocurrencies have fallen in price, the prevalence of fraud has continued to grow.
In the letters, Brown asked CEOs to detail the review and monitoring processes for crypto apps to prevent apps from “turning into phishing” scams. He’s also looking for any information Apple and Google have provided consumers about fake investment apps.
“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.
The inquiries came hours before the Senate Banking Committee, chaired by Brown, was to hold a hearing with cryptocurrency experts on ways Congress could reduce fraud in the crypto and securities markets.
Apple and Google have until August 10 to respond to the senator’s requests.
