Big tech giants Apple and Google have received letters from US lawmakers, asking for details on crypto-related apps that are available on App Store and PlayStore respectively. In these letters, Senator Sherrod Brown, the chair of the Senate Banking Committee has also asked the companies to provide information on the ways they tackle potentially dangerous apps that may be promoting crypto scams. The US authorities are tightening scrutiny over the crypto sector after recent analytical reports claimed that Americans crypto investors lost over $1 billion (roughly Rs. 8,000 crore) to scams between January 2021 and March 2022.
The letters, addressed to Tim Cook and Sundar Pichai come in the backdrop of a Federal Bureau of Investigation (FBI) warning that has recently claimed that fake crypto apps that have scammed hundreds of investors have accounted for losses exceeding $42 million (roughly Rs. 333 crore) in recent months.
“Cyber criminals have stolen company logos, names, and other identifying information of crypto firms and then created fake mobile apps. It is imperative that app stores have the proper safeguards in place to prevent against fraudulent mobile application activity,” Brown wrote in his letters to the tech giants.
The companies are required to provide information on the review process that they undertake before granting approval to an app.
Apple and Google have further been asked to describe how and how often do they monitor apps that are available for download on their respective app stores.
Their responses to the queries remain awaited for now.
“Since January 2020, has your app store coordinated or shared any actions or activities with other app stores related to the suspension or removal of fraudulent cryptocurrency apps? If so, please explain. Describe all actions your app store has taken to alert people about actual or potentially fraudulent activity associated with cryptocurrency investment apps,” Brown's letter has inquired.
As per the FBI warning, cyber criminals are creating fraudulent cryptocurrency investment apps to exploit legitimate cryptocurrency investments, defrauding US investors and causing reputational harm to US investment firms.
Romance scams and investment scams are among other popular categories being explored by cyber criminals. Business and government imposters are also on a constant lookout for victims that can be duped.
The FBI has instructed crypto investors to be wary of unsolicited requests to download investment applications, especially from unverified strangers.
“Verify an app is legitimate before downloading it by confirming the company offering the app actually exists, identifying whether the company or app has a website, and ensuring any financial disclosures or documents are tailored to the app's purpose and the proposed financial activity. Treat applications with limited and/or broken functionality with scepticism,” the FBI noted.
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