Sen. Sherrod Brown seeks information on the procedure for reviewing apps.
Over the past few years, cryptocurrency and Non-Fungible Token (NFT) criminals have stolen billions of dollars from investors using everything from Elon Musk Twitter impersonators to shady Discord talks. Politicians and law enforcement are increasingly focusing on Apple and Google, which run sizable app stores, and how they evaluate bogus cryptocurrency apps.
Sen. Sherrod Brown (D-OH) wrote letters on Thursday to Apple CEO Tim Cook and Google CEO Sundar Pichai requesting an explanation of the firms' procedures for evaluating and approving crypto trading and wallet apps for download on their respective app stores.
Following the release of an FBI report warning that 244 investors had been duped out of $42.7 million by fraudulent cryptocurrency apps posing as reliable investment platforms in less than a year, Brown launched his investigation.
The senator wrote to Cook on Thursday, saying "Crypto mobile apps are available to the public through app shops, including Apple's App Store." While cryptocurrency trading apps have made it simple and quick for investors to do so, instances of bogus crypto apps that have defrauded hundreds of investors have also surfaced.
Requests for comment from Apple and Google did not immediately receive a response.
The FBI and Justice Department, among other federal law enforcement agencies, started taking action against con artists earlier this month on suspicion of stealing millions, if not billions, of dollars from customers. Scams are becoming more commonplace despite the price decline of Bitcoin and other cryptocurrencies.
In order to stop crypto apps from "transforming into phishing" frauds, Brown urged the CEOs in the letters to provide specifics about their crypto app assessment and monitoring procedures. Additionally, he is searching for any information that Google and Apple may have sent users about fake financial apps.
It is crucial that app stores have the right safeguards in place to guard against fraudulent mobile application activity, the senator wrote. "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," he wrote.
A session with bitcoin specialists on how Congress may lessen scams in the cryptocurrency and securities markets was scheduled by Brown's Senate Banking Committee hours before the questions were made. The senator has given Apple and Google until August 10 to answer.