The Head of a Senate Committee Questions Apple and Google on Safeguards Against Fraudulent Cryptocurrency Apps
If app shops are doing enough to combat fraud, Brown wants to know
A significant senator wants to ensure that app store providers are taking action against cryptocurrency scams, which remain a major issue. Sen. Sherrod Brown, the chair of the Senate Banking Committee, has written letters to the heads of Apple and Google demanding information on their safeguards against cryptocurrency app fraud. The lawmaker requested information about their procedures for app approval and reporting, user alerts for fraudulent activity, collaboration with competing shops, and monitoring for apps that turn into phishing scams.
Apple and Google have been contacted for comment. The executives were given until August 10th by Brown to respond to the letters.
Both IT companies offer at least some screening for fake cryptocurrency applications. Apps that use bait-and-switch techniquesare forbidden by Apple's review policies for the App Store. Google's Play Store regulations are less restrictive but prohibit apps that encourage "dishonest behavior" or unlawful activity. You can report questionable apps to both businesses. However, they haven't traditionally handed out direct fraud notifications, and they aren't renowned for constantly watching for apps that might start spreading phishing scams.
Brown considered strong safeguards to be crucial, regardless of viewpoints. According to a recent FBI alert, fraud involving cryptocurrency apps has already cost $42.7 million. The senator stated that it was "imperative" that businesses safeguard investors from this harm.
The requests may or may not result in legislation mandating more stringent anti-fraud measures. However, the committee's request might make Apple and Google's positions on the matter clearer and might put more on them to take additional action. It serves as a reminder that just because a program is available on Google Play or the App Store doesn't mean it will be reliable.
The Federal Trade Commission reports that recent losses from romance scams, many of which use online dating services, have "skyrocketed." The reported losses for the previous year were at an all-time high of $547 million. These "pig butchering" scams, which are a subtype of these romantic scams that include cryptocurrencies, tempt victims to keep depositing money into a fake cryptocurrency app, fattening them up, before the scammers flee with huge quantities of cryptocurrency.
The FTC also noted that between 2020 and 2021, crypto payments to con artists increased five-fold, reaching $139 million.
An advocacy group, the Global Anti-Scam Organization, informed Forbes last month that it is incredibly uncommon for victims to be able to get their money back.
Attorney Arlo Kipfer of Seattle said, "I've talked to 50 people in the last six months. I've also advised fraud victims on how to proceed." The victims are bled dry, which is the most devastating aspect—the chances of recovery are still slim.
