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🇮🇩 Indonesia /Crime & Justice

Apple Sued Over Fraudulent Crypto Apps on App Store

From Tempo · () Indonesian

Translated from Indonesian, summarized and contextualized by DistantNews.

At a glance

News Sources not specified In the courts
  • Apple faces a lawsuit in California for allegedly failing to prevent fraudulent crypto apps on its App Store.
  • Three users claim they lost $1.8 million after downloading fake crypto wallet apps that bypassed Apple's security checks.
  • The lawsuit accuses Apple of negligence and potentially profiting from fake apps by taking commissions.

Tech giant Apple is facing a lawsuit in the U.S. District Court for the Northern District of California after fraudulent cryptocurrency applications on its App Store allegedly caused users to lose $1.8 million.

The plaintiffs downloaded an app named Sparrow Wallet, even though the official Sparrow Bitcoin Wallet is not available on iOS.

— TechCrunch report citing the lawsuitDescribing the specific fake app that led to the lawsuit.

The lawsuit, filed by three users, accuses Apple of negligence in its platform's security screening process, which allowed fake applications to proliferate. These scam apps reportedly disguised themselves as legitimate digital wallets, tricking users into downloading them and subsequently losing all their crypto assets.

According to a TechCrunch report citing the lawsuit, the plaintiffs downloaded an app named Sparrow Wallet, despite the official Sparrow Bitcoin Wallet not being available on iOS. They are seeking accountability from Apple for their financial losses.

Apple has failed to conduct background checks and minimum security verification against applications published in its store.

— Lawsuit filingAllegation against Apple regarding its app review process.

The plaintiffs argue that as the platform manager, which takes up to a 30% commission from developers, Apple failed to conduct adequate background checks and minimum security verification for apps listed in its store. The lawsuit also alleges that Apple intentionally allowed fake applications to exist on its platform, referencing public criticism from the creator of Sparrow Bitcoin Wallet, Craig Raw, who claimed Apple continued to permit imitation apps despite being notified.

Apple continues to allow imitation Sparrow Wallet apps to operate despite being reported.

— Craig RawCreator of Sparrow Bitcoin Wallet, criticizing Apple's inaction.

This incident intensifies scrutiny on the App Store's moderation system, which critics argue is vulnerable to social engineering-based financial scams. Apple's claims of exclusive security standards for the App Store are now being questioned in court. Apple has declined to comment officially on the ongoing lawsuit but maintains its defense of its security systems, stating that imitation apps violate community guidelines and are swiftly removed.

Applications that imitate others are a serious violation of community guidelines and will be dealt with strictly through rapid removal.

— Apple spokespersonApple's general stance on imitation apps, as stated previously.
DistantNews Editorial

Originally published by Tempo in Indonesian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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