Sparrow Wallet Lawsuit
Joe Rossignol (PDF):
The complaint alleges that Apple violated California’s Consumers Legal Remedies Act and other laws by failing to adequately review and monitor apps distributed through the App Store, despite marketing it as “a safe and trusted place to discover and download apps.” Due to these assurances in Apple’s marketing, the complaint said the plaintiffs trusted that a Sparrow Wallet app they downloaded from the App Store on iOS was legitimate, when in reality it was a fraudulent spoof designed to steal Bitcoin from users.
Sparrow Wallet is only available on Windows, macOS, and Linux. The popular Bitcoin wallet is not available on iOS, but scammers have released fake lookalike apps in the App Store that can trick users into giving up control of their funds.
[…]
Even when victims reported fraud, the lawsuit alleges that Apple often took little to no action, and it says other fake Sparrow apps remain in the App Store.
Sparrow Wallet developer Craig Raw has publicly addressed Apple’s slow response to multiple fake versions of his app appearing in the App Store. In a January 2024 social media post, for example, he said “there is still a scam ‘Sparrow Wallet’ app on the @Apple App Store, despite myself and others having reported it weeks ago.”
My attempt to protect users from scam apps on the @AppStore has gotten my Apple Developer account flagged for termination - ironically, for “dishonest activity”.
[…]
I’m the developer of the real Sparrow Wallet, a desktop app, and I hold the registered US trademarks for the name and logo. I have publicly warned @Apple and the community about these fake apps from early 2024, but they keep appearing.
The app @Apple flagged was a placeholder that was never published. Its only purpose was to warn users that Sparrow is desktop-only and that other “Sparrow” apps aren’t mine. This approach may have been misguided, but there was nothing dishonest about it.
In response to our request for comment, Apple said it has taken swift action to remove any apps impersonating Sparrow Wallet[…] Apple says it takes immediate action against apps that do not comply with its guidelines.
Previously:
- Hide My Email Vulnerability Exposes Real Address
- Sirius Pomodoro
- The App Store Scammer Strikes Back
- Sanctioned Entities Slip Through App Store Controls
- Some of the Apps in the App Store
- Fake Bitcoin Wallet in the App Store
- Fraudulent Rabby Wallet App
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This seems to be an open-and-shut case in favor of the plaintiffs, with all the evidence from the wallet developer themselves, and ample evidence elsewhere (like Lapcat's documentation of all the scams). Apple claims it protects consumers but it seems like it does nothing of the sort, and I hope this lawsuit causes some changes at Apple (unlikely, I know).
This is the most clear cut case yet that the rules are there to protect Apple's interests and no others, at the least possible expense.
To flag the account for dishonesty over what is admittedly something they are not really set up to do is a very strange outcome. Clearly, if any human at Apple ever saw app and read the description, they did not understand what they read. Thinking it through, perhaps in a rush to just get through as many apps as possible (if human), they read enough to know that the app didn't do anything on iOS and so pressed a rejection button and quickly moved on, not really caring about the consequences.
Up until recently Apple didn't even allow Bitcoin wallets in the first place. I assume their policy changed when they realized they could take a cut off in app purchase, which is presumably high. I've never used a Bitcoin wallet in iOS and have no interest in it, so correct me if I'm wrong. But that's usually what manages to catch their interest these days.
All that said and as two faced and scummy and just plain kind of bad as they are at this specific job (the App Store and its handling specifically), they should have just stuck to their policy. In my (non-legal) opinion, it is these users' fault they lost their money with no recourse. Turns out when it's "fiat" money the organization issuing the fiat actually cares what happens to it sometimes. It was on them to do their due diligence with those huge sums of money just like if they wired it to the wrong wire to pay a mortgage or home purchase.
I for one am glad that Apple has once again waited until the damage is long done to tell us that they've removed the offending applications, now that we all know they were there in the first place.
if you give a small reward to a decent high-schooler or a student, like a $100, and set them a task to find a dozen scam apps, they will be able to do that every day. There are so many of them and they are poping up in search or even adds left and right. Apple review process is really flowed and they have to be harshly incentivized to fix it.
Apple should be taken to the cleaners over this.
They should not be able to endlessly say the App Store is safe and they are protecting users and let this stuff through and pay no attention to reports about it.
Which is why they should never have tried - but they did because it makes them money, lots and lots of money, including lots of money off these scamming apps.
