Google’s parent company, Alphabet, has initiated a lawsuit against individuals based in China accused of deploying scam cryptocurrency apps, which have been downloaded over 100,000 times via Google Play. This legal move underscores a broader effort to combat the increasing menace of fraudulent apps that deceive users into investing funds they are unable to withdraw.
Battling the Scammers: Alphabet’s Lawsuit
Alphabet’s decision to file a lawsuit on Thursday in a federal court in New York is a significant step towards clamping down on the fraudulent use of its platforms, including Google Play and YouTube, for crypto scams. The company alleges that the defendants have committed hundreds of acts of wire fraud, engaging in a pattern of racketeering that has misled countless users since 2019.
The fraudulent apps, cleverly disguised to resemble legitimate digital asset investment opportunities, have been a persistent challenge, evading Google’s fraud detection systems repeatedly. Google’s general counsel, Halimah DeLaine Prado, emphasized the lawsuit’s importance in holding the perpetrators accountable and protecting users from exploitation.
The Rising Tide of Crypto Phishing Scams
This lawsuit comes at a time when crypto phishing scams are on the rise, with a 50% increase in victims and losses reported in March alone, compared to February. According to Scam Sniffer, $71 million was swindled from 77,529 victims across various chains in March. The first quarter of 2024 saw a total of $173 million in digital assets lost to phishing scams, with a staggering 90% involving ERC-20 tokens on the Ethereum network.
Phishing scams, a type of social engineering fraud, trick individuals into divulging sensitive information or installing malware. The cryptocurrency sector, particularly decentralized finance (DeFi) applications, has been heavily targeted, with $1.8 billion lost to hacks and scams in 2023 alone. Notably, the North Korean Lazarus Group has been implicated in 17% of these losses.
