From Elon Musk Twitter impersonators to dubious Discord chats, cryptocurrency and non-fungible token (NFT) scammers have stolen billions of dollars from investors over the last few years. But now, politicians and law enforcement are turning their attention to Apple and Google — companies that operate huge app stores — and how they review 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 in reviewing and approving crypto trading and wallet apps for download on their app stores. Brown’s inquiry follows a recently released FBI report warning that 244 investors have been scammed out of $42.7 million from fraudulent cryptocurrency apps claiming to be credible investment platforms in under a year.
It is “imperative that app stores have the proper safeguards in place to prevent against fraudulent mobile application activity”
“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 emerged of fake crypto apps that have scammed 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 Justice Department, began taking action against scammers accused of stealing millions, and sometimes billions, of dollars from consumers. Even as Bitcoin and other cryptocurrencies have fallen in price, the prevalence of scams has continued to grow.
In the letters, Brown asked the CEOs to detail their crypto app review and monitoring processes to prevent apps from “transforming into phishing” scams. He’s also looking for any information Apple and Google have provided consumers about fake investment apps.
“While firms that offer crypto investment and other related services should take the necessary steps to prevent fraudulent activity, including warning investors about the uptick in scams, it is likewise imperative that app stores have the proper safeguards in place to prevent against fraudulent mobile application activity,” the senator wrote.
The inquiries came hours before the Senate Banking Committee, chaired by Brown, was set to hold a hearing with cryptocurrency experts on ways Congress could mitigate scams in the crypto and securities markets.
Apple and Google have until August 10th to respond to the senator’s requests.